2014 Annual Update of the Electric and Natural Gas Conservation and Load Management Plan

Transcription

1 Docket No Compliance Filing 2014 Annual Update of the Electric and Natural Gas Conservation and Load Management Plan Submitted by: The Connecticut Light and Power Company The United Illuminating Company The Yankee Gas Services Company Connecticut Natural Gas Corporation and Southern Connecticut Gas Company February 28, 2014

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3 Table of Contents CHAPTER ONE: OVERVIEW (Electric and Natural Gas)... 1 CHAPTER TWO: APPROVED BUDGET TABLES/EXCEL FILES (EDCs and LDCs)... 4 Electric Distribution Company (EDC) Combined Tables The Connecticut Light and Power Company and the United Illuminating Company... 5 Table A1 Combined CL&P and UI Budgets... 6 Table A2 CL&P and UI Funding Sources... 8 Table A Pie... 9 Table A Pie Table B Statewide Total Resource Costs and Benefits Table B Statewide Total Resource Costs and Benefits The Connecticut Light & Power Company Budget Tables Table A CL&P 2013 Actual Results, Budget Table A 2014 Pie Table A 2015 Pie Table B CL&P Comparison of Program Energy Savings Table B CL&P Comparison of Program Benefits Residential Table B CL&P Comparison of Program Benefits C&I Table B CL&P Comparison of Programs Energy Savings Table B CL&P Comparison of Program Benefits Residential Table B CL&P Comparison of Program Benefits C&I Table C 2014 Pie Table C 2015 CL&P Budget Table C 2015 Pie Table D CL&P Historical and Projected Program Expenditures Table D1 C&LP Historical and Projected Annual kw Table D2 CL&P Historical and Projected Annual kwh Table D3 CL&P Historical and Projected Lifetime kwh Table D4 CL&P Historical and Projected Units CL&P Performance Incentive

4 CL&P Performance Incentive The United Illuminating Company Budget Tables Table A UI 2013 Actual Results, Budget Table A 2014 Pie Table A 2015 Pie Table B 2014 UI Comparison of Conservation Programs Table B 2015 UI Comparison of Conservation Programs Table C 2014 UI Budget Table C 2014 Pie Table C 2015 UI Budget Table C 2015 Pie Table D UI Historical and Projected Program Expenditures and kw Table D1 UI Historical and Projected Annual kwh and Lifetime kwh UI Performance Incentive UI Performance Incentive Combined Natural Gas Companies Budget Tables Table A Combined Natural Gas Companies Plan A Pie A Pie Table A Combined Natural Gas Companies Funding Sources The Yankee Gas Services Company Budget Tables Table A Yankee Gas 2013 Actual Results, Budget Table A 2014 Pie Table A 2015 Pie Table B Yankee Gas Comparison of Program Energy Savings Table B Yankee Gas Comparison of Program Benefits Table B Yankee Gas Comparison of Programs Energy Savings Table B Yankee Gas Comparison of Program Benefits Table C 2014 Yankee Gas Program Budget by Category Table C 2014 Pie Table C 2015 Yankee Gas Program Budget by Category Table C 2015 Pie... 89

5 Table D1 YGS Historical and Projected Program Expenditures Table D2 YGS Historical and Projected Program Units Table D3 & D4 YGS Historical and Projected Annual and Lifetime CCF YGS Performance Incentive YGS Performance Incentive The Connecticut Natural Gas Corporation Budget Tables Table A CNG 2013 Actual Results, Budget Table A 2014 Pie Table A 2015 Pie Table B 2014 CNG Comparison of Program Energy Savings Table B 2015 CNG Comparison of Programs Energy Savings Table C 2014 CNG Program Budget by Category Table C 2014 Pie Table C 2015 CNG Program Budget by Category Table C 2015 Pie Table D CNG Historical and Projected Program Expenditures and Units Table D1 CNG Historical and Projected Annual and Lifetime CCF CNG Performance Incentive CNG Performance Incentive The Southern Connecticut Gas Company Budget Tables Table A SCG 2013 Actual Results, Budget Table A 2014 Pie Table A 2015 Pie Table B 2014 SCG Comparison of Program Energy Savings Table B 2015 SCG Comparison of Programs Energy Savings Table C 2014 SCG Program Budget by Category Table C 2014 Pie Table C 2015 SCG Program Budget by Category Table C 2015 Pie Table D SCG Historical and Projected Program Expenditures and Units Table D1 SCG Historical and Projected Annual and Lifetime CCF SCG Performance Incentive

6 SCG Performance Incentive CHAPTER THREE: RESIDENTIAL PROGRAMS (Electric and Natural Gas) Residential Retail Products (Electric) Residential New Construction Home Energy Solutions Program Water Heating Program Home Energy Solutions Income Eligible (Electric and Natural Gas Residential Behavior Program (Electric and Natural Gas) CHAPTER FOUR: COMMERCIAL AND INDUSTRIAL PROGRAMS C&I NEW CONSTRUCTION Energy Conscious Blueprint C&I RETROFIT Energy Opportunities Small Business Energy Advantage BUSINESS & ENERGY SUSTAINABILITY Retro-Commissioning ( RCx ) Process Re-engineering for Increased Manufacturing Efficiency ( PRIME ) O&M Services Business Sustainability Challenge ( BSC ) Self-Directed Customer Solutions CHAPTER FIVE: EDUCATION and OUTREACH eesmarts SmartLiving Center CHAPTER SIX: BENEFIT/COST ANALYSIS APPENDICIES Appendix I: Compliance Items Appendix II Marketing Plan

7 CHAPTER ONE: OVERVIEW (Electric and Natural Gas) On October 31, 2013, the Department of Energy and Environmental Protection ( DEEP ) approved the Conservation and Load Management Plan (the Plan ) submitted by Connecticut s gas and electric utility companies on November 1, The approval of this Plan marked a historic transition in Connecticut to a new level of energy saving program activity not previously seen in Connecticut. This Plan approval and the implementation of the energy savings strategies embodied within the Plan will put Connecticut on a path to a greener energy future. Included in DEEP s Final Decision (the Decision ) were modifications and compliance orders to the Plan required by DEEP. The Connecticut Light and Power Company ( CL&P ), The United illuminating Company ( UI ), The Connecticut Natural Gas Corporation ( CNG ), The Southern Connecticut Gas Company ( SCG ), and Yankee Gas Services Company ( YGS ) (collectively the Companies ) are pleased to provide the following update to the Plan ( Plan Update ). The Plan Update includes specific changes occurring in the 2014 program year to address the overarching objectives envisioned in the Decision and to address related Compliance Items. In addition, the Plan Update includes many of the key themes that were embodied in the Decision. These include: In order to achieve the overall objectives laid out by DEEP, the Companies will need to increase the overall level of program promotion in the coming years. Throughout 2014 and 2015, the Companies will continue to develop and refine market segmentation efforts to better target program offerings to identified customer groups for both Residential and Commercial and Industrial ( C&I ) sectors. In addition to the programmatic marketing 2014 and 2015 will integrate customer segmentation efforts and data driven analytics to increase market penetration in targeted Residential and C&I areas. The Plan Update includes increased focus on a broad based marketing message. This has the goal of significantly increasing customer awareness of the value of the services available to them, the benefits of energy efficiency and the concept of home performance. These efforts will be built around the new EnergizeCT brand, and will begin the important first steps of building an energy efficiency ethic in Connecticut. Marketing efforts will also be enhanced to promote the concept and value of Home Performance, including health, safety, comfort and savings. In conjunction with this broad based marketing effort we will be launching the Department of Energy ( DOE ) Home Energy Score label in 2014, which is intended to drive customer demand and move us toward a more market-based approach to Home Performance. Deployment of the Northeast Utilities ( NU ) Energy Efficiency Customer Engagement Platform ( CEP ) outlined in the Plan is moving forward. The CEP is a critical tool that will enable NU to identify, customize and deliver energy efficiency products and services to both residential and business customers and will assist customers to make better informed decisions. CL&P and YGS are supporting the integration and deployment of their CEP through the funds allocated in the 1

8 Decision, via program marketing resources, and through the Statewide Marketing Plan, included in this Update. The Companies will enhance the promotion of Light-Emitting Diodes ( LED ) throughout the programs. In particular, the Retail Products program will provide enhanced education and awareness on LED technologies, and will continue to work with manufactures and retailers to align Negotiated Cooperative Promotions with the LED market trends. LEDs will also be further incorporated into the Home Energy Solutions ( HES ) program through reduced co-pays and provision of a prescribed amount of free LEDs as part of the HES core services. The 2014 HES electric program budget, as prescribed in the Decision provides for a level of funding that is consistent with 2013 funding. DEEP has allocated additional potential electric funding which is contingent upon the results of the HES Impact Evaluation and the HES Innovation process, both of which are currently under way. Both of these activities will result in recommendations for further program enhancements. Until the recommendations are finalized, the Companies are providing the program changes described below in order to continue to expand upon the services provided within HES, enhance the value to participants and continue to transform the Home Performance market. The gas and electric budgets and savings reflected planning models are inclusive of the entire HES electric budget including the potential allocation. Note that the natural gas budgets do not include a potential HES allocation. However, since the HES natural gas and electric budgets and projections run in parallel, the electric HES additional potential allocation will have an impact on the natural gas budgets. Specifically, if the electric HES allocation budget is not approved for use in HES, natural gas HES spending may have to be curtailed and/or a greater cost share for both natural gas and non natural gas measures will need to be provided by natural gas. The Companies have modified the performance incentive metrics and targets as ordered in the Decision. These revised metrics are designed to drive increased savings, promote comprehensive measures and increase program participation. Additionally, the gas performance incentive metric tables are aligned with additional programmatic sub-metrics beyond energy and net energy benefits. Residential metrics include increased savings per home, and increased adoption of additional measures beyond core program savings while the C&I metrics focus on increasing the efficiency of manufacturing customers. Upstream promotions will become an important tool in The Companies recently launched a residential upstream initiative to promote Heating, Ventilation, and Air Conditioning ( HVAC ) and domestic water heating equipment through distribution channels. This initiative will be expanded in 2014 to additional distributors and equipment. A commercial lighting upstream promotion will be launched in 2014 to promote low wattage T-8s and LED lamps, allowing the Companies to reach a broader base of customers. Also, additional products and strategies to promote efficient electric and gas HVAC equipment through manufacturers and distributors will be explored throughout the year. All upstream initiatives will be timed so as to minimize any negative impact on traditional downstream (customer) incentives with respect to the budgets. Industrial customers will be a continued focus in the coming years. The Companies will work closely with manufacturers, enabling them the flexibility required to embed efficiency into the 2

9 core of their operations. The Companies will also work on the Department of Energy s ( DOE ) Superior Energy Performance Accelerator as well as a revamped Business Sustainability Challenge ( BSC ) with an eye towards developing best practices for C&I energy savings. The Companies will continue to refine their customer segmentation efforts by further analyzing their C&I customer base into meaningful segments and delivery approaches, especially critical for the largest quantity of customers within quartile 4, which will require a very different market channel and go-to-market strategy. As a result of the Companies segmentation efforts, current operating models will require modification. CL&P believes that dedicated energy efficiency sales personnel are needed to penetrate certain key segments such as manufacturing. Likewise, UI has decided to realign its C&I team s focus by targeting the largest customer segments while still continuing to address all market segments. The top ten segments representing the largest percentages of energy consumption for both Companies are as follows: Manufacturing, Water/Wastewater, Government, Retail, Healthcare, Real Estate Management (Corporate Space), Education, Consumer Goods/ Foods, Data Centers, and Communication/Entertainment. To further address the needs of the manufacturing customer segment, the Companies will continue to develop a new Process Reengineering for Increased Manufacturing Efficiency ( PRIME ) Request for Proposal ( RFP ) not only to increase the number of vendors but to establish specific goals for increased savings within the facilities and to create opportunities for BSC initiatives. The Companies will focus on facilitating Strategic Energy Management ( SEM ) practices by utilizing multi-year Memorandums of Understanding ( MOU ) with their largest customers as a formal mechanism to facilitate long-term goals achieving significant energy reduction. In addition, small-to-medium sized businesses will be increasingly targeted through packaged SEM and customer engagement tools. The Companies will continue coordination with allied agencies regarding Connecticut Energy Efficiency Fund ( CEEF ) programs and fund leveraging, including Clean Energy Finance and Investment Authority-Property Assessed Clean Energy ( CEFIA-CPACE ), (Lead By Example- Energy Savings Performance Contracts ( LBE-ESPC ), LBE--State Buildings, ISE-state, educational facility energy management, benchmarking and Small Business Energy Advantage ( SBEA ) market outreach. The Companies will continue its efforts to leverage CEEF funds through promotion and enhancement of CEEF financing offerings, coordination with partners complementary programs (CEFIA-CPACE, LBE-ESPC) in an effort to reduce financing costs, etc. 3

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11 CHAPTER TWO: APPROVED BUDGET TABLES/EXCEL FILES (EDCs and LDCs) Electric Distribution Company (EDC) Combined Tables The Connecticut Light and Power Company and the United Illuminating Company 5

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13 Table A1 Combined CL&P and UI Budgets Table A CL&P/UI C&LM Budget CL&P UI CL&P/UI CL&P UI CL&P/UI CL&P/UI C&LM BUDGET DEEP Decision** DEEP Decision** Combined DEEP Decision** DEEP Decision** Combined 10/31/13 10/31/13 Total 10/31/13 10/31/13 Total RESIDENTIAL Residential Retail Products $ 12,324,704 $ 2,975,296 $ 15,300,000 $ 12,540,391 $ 3,259,609 $ 15,800,000 Total - Consumer Products $ 12,324,704 $ 2,975,296 $ 15,300,000 $ 12,540,391 $ 3,259,609 $ 15,800,000 Residential New Construction $ 1,645,758 $ 154,242 $ 1,800,000 $ 1,652,216 $ 147,784 $ 1,800,000 Home Energy Solutions (HVAC, Duct Sealing, Lighting) $ 11,733,143 $ 2,515,354 $ 14,248,497 $ 11,508,897 $ 2,657,484 $ 14,166,381 Home Energy Solutions Potential Allocation $ 3,569,655 $ 540,000 $ 4,109,655 $ 4,367,674 $ 929,519 $ 5,297,193 HES Income Eligible $ 17,201,791 $ 3,253,718 $ 20,455,509 $ 17,245,279 $ 3,293,820 $ 20,539,099 Residential Behavior $ 3,000,000 $ 300,000 $ 3,300,000 $ 3,000,000 $ 300,000 $ 3,300,000 Subtotal Residential $ 49,475,050 $ 9,738,610 $ 59,213,660 $ 50,314,457 $ 10,588,216 $ 60,902,673 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint $ 9,913,103 $ 3,777,000 $ 13,690,103 $ 9,568,420 $ 3,777,000 $ 13,345,420 Total - Lost Opportunity $ 9,913,103 $ 3,777,000 $ 13,690,103 $ 9,568,420 $ 3,777,000 $ 13,345,420 C&I LARGE RETROFIT Energy Opportunities $ 32,030,505 $ 5,853,457 $ 37,883,962 $ 31,834,968 $ 5,853,457 $ 37,688,425 Business & Energy Sustainability (O&M, RetroCx, BSC) $ 4,865,023 $ 1,624,977 $ 6,490,000 $ 4,865,023 $ 1,624,977 $ 6,490,000 PRIME $ 660,000 $ 150,000 $ 810,000 $ 660,000 $ 150,000 $ 810,000 Total - C&I Large Retrofit $ 37,555,528 $ 7,628,434 $ 45,183,962 $ 37,359,991 $ 7,628,434 $ 44,988,425 Small Business $ 18,900,000 $ 3,825,935 $ 22,725,935 $ 19,357,951 $ 3,825,935 $ 23,183,886 Subtotal C&I $ 66,368,631 $ 15,231,369 $ 81,600,000 $ 66,286,362 $ 15,231,369 $ 81,517,731 OTHER - EDUCATION * SmartLiving Center - Museum Partnerships $ 1,091,259 $ 988,741 $ 2,080,000 $ 570,486 $ 413,514 $ 984,000 Clean Energy Communities $ 1,364,040 $ 355,960 $ 1,720,000 $ 1,364,040 $ 355,960 $ 1,720,000 EE Smarts/K-12 Education $ 479,126 $ 320,874 $ 800,000 $ 479,126 $ 320,874 $ 800,000 Customer Engagement $ 480,000 $ 120,000 $ 600,000 $ 480,000 $ 120,000 $ 600,000 Subtotal Education $ 3,414,425 $ 1,785,575 $ 5,200,000 $ 2,893,652 $ 1,210,348 $ 4,104,000 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy (ECSU) $ 358,400 $ 89,600 $ 448,000 $ 358,400 $ 89,600 $ 448,000 ESPC Project Manager - Lead By Example $ 96,000 $ 19,200 $ 115,200 $ 96,000 $ 19,200 $ 115,200 Residential Loan Program (Includes ECLF) $ 1,594,889 $ 688,211 $ 2,283,100 $ 2,053,121 $ 382,560 $ 2,435,681 C&I Loan Program $ 1,087,227 $ 693,123 $ 1,780,350 $ 1,087,227 $ 693,123 $ 1,780,350 C&LM Loan Defaults $ 105,000 $ 35,000 $ 140,000 $ 108,889 $ 31,111 $ 140,000 C&I Self Funding $ 4,000,000 $ 1,000,000 $ 5,000,000 $ 4,000,000 $ 1,000,000 $ 5,000,000 Subtotal Programs/Requirements $ 7,241,515 $ 2,525,134 $ 9,766,650 $ 7,703,637 $ 2,215,594 $ 9,919,231 OTHER - LOAD MANAGEMENT ISO Load Response Program $ 3,400,000 $ 3,400,000 $ 3,000,000 $ 3,000,000 Subtotal Load Management $ 3,400,000 $ - $ 3,400,000 $ 3,000,000 $ - $ 3,000,000 OTHER - RENEWABLES & RD&D Research, Development & Demonstration $ 422,794 $ 152,206 $ 575,000 $ 442,308 $ 132,692 $ 575,000 Subtotal Renewables & RD&D $ 422,794 $ 152,206 $ 575,000 $ 442,308 $ 132,692 $ 575,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 907,271 $ 540,241 $ 1,447,512 $ 907,271 $ 540,241 $ 1,447,512 Marketing Plan $ 1,626,667 $ 813,333 $ 2,440,000 $ 1,626,667 $ 813,333 $ 2,440,000 Planning (UI Planning & Evaluation) $ 703,170 $ 256,830 $ 960,000 $ 703,170 $ 256,830 $ 960,000 Evaluation (UI Evaluation, Outside Services) $ 2,263,634 $ 578,922 $ 2,842,556 $ 2,429,635 $ 621,721 $ 3,051,356 Evaluation Consultant $ 233,243 $ 58,311 $ 291,554 $ 233,243 $ 58,311 $ 291,554 Information Technology $ 1,338,112 $ 261,888 $ 1,600,000 $ 1,338,112 $ 261,888 $ 1,600,000 Energy Efficiency Board $ 361,513 $ 241,009 $ 602,522 $ 361,513 $ 241,009 $ 602,522 Performance Management Fee $ 6,858,063 $ 1,594,205 $ 8,452,268 $ 6,882,263 $ 1,593,612 $ 8,475,875 Admin/Planning Expenditures $ 14,291,673 $ 4,344,739 $ 18,636,412 $ 14,481,874 $ 4,386,945 $ 18,868,819 PROGRAM SUBTOTALS Residential $ 55,198,637 $ 12,570,123 $ 67,768,760 $ 56,079,658 $ 12,653,896 $ 68,733,554 C&I $ 75,969,251 $ 17,434,299 $ 93,403,550 $ 75,386,716 $ 17,315,365 $ 92,702,081 Other* $ 13,446,201 $ 3,773,212 $ 17,219,412 $ 13,655,915 $ 3,795,904 $ 17,451,819 TOTAL Note 1 $ 144,614,089 $ 33,777,634 $ 178,391,723 $ 145,122,289 $ 33,765,165 $ 178,887,455 * OTHER -EDUCATION is primarily allocated to residential programs. ** The Budgets are the DEEP Approved Budgets from the October 31, 2013 Final Decision with technical corrections and some minor adjustments Note 1: See Table A2 for Revenue Breakdown 7

14 Table A2 CL&P and UI Funding Sources Table A2 2014, 2015 CL&P/UI C&LM Revenues 2015 DEEP Final Decision 2014 DEEP Final Decision CL&P UI 2014 CL&P UI 2015 CL&P/UI C&LM REVENUES Revenues Revenues CL&P/UI Revenues Revenues CL&P/UI Total Total Collections (Mill Rate) $ 67,071,000 $ 15,825,000 $ 82,896,000 $ 67,014,000 $ 15,558,000 $ 82,572,000 ISO-NE Forward Capacity Market Energy Efficiency Revenues $ 8,000,000 $ 2,400,000 $ 10,400,000 $ 9,000,000 $ 2,800,000 $ 11,800,000 ISO-NE Forward Capacity Market Demand Response Revenues $ 3,400,000 $ 3,400,000 $ 3,000,000 $ 3,000,000 RGGI* $ 4,000,000 $ 1,000,000 $ 5,000,000 $ 4,000,000 $ 1,000,000 $ 5,000,000 CAM (Net of Gross Receipts Tax) $ 62,143,089 $ 14,552,633 $ 76,695,722 $ 62,108,289 $ 14,407,165 $ 76,515,454 Total - C&LM Revenues $ 144,614,089 $ 33,777,633 $ 178,391,722 $ 145,122,289 $ 33,765,165 $ 178,887,454 *RGGI Budget is based Public Act

15 Table A Pie Statewide (CL&P and UI) 2014 C&LM Budget and Parity Analysis Table A1 Pie Chart C&LM Budget By Customer Class C&LM Revenue By Customer Class Res. Income Eligible 13% Res. Income Eligible 13% C&I 58% Res. Non Income Eligible 29% C&I 57% Res. Non Income Eligible 30% Customer Class Budget ($,000) % of Total C&LM Budget % of Residential & C&I Budget % of Residential & C&I Revenue Difference Res. Income Eligible $21,688,499 12% 13% 13% 0% Res. Non Income Eligible $46,080,261 26% 29% 30% -1% Residential Subtotal $67,768,760 38% 42% 43% -1% C&I $93,403,550 52% 58% 57% 1% C&I Subtotal $93,403,550 52% 58% 57% 1% Residential and C&I Subtotal $161,172,310 90% 100% 100% 0% Other Expenditures Other Expenditures $17,219,412 10% Other Expenditures Subtotal $17,219,412 10% C&LM TOTAL $178,391, % CL&P $144,614,089 81% UI $33,777,634 19% 9

16 Table A Pie Statewide (CL&P and UI) 2015 C&LM Budget and Parity Analysis Table A1 Pie Chart C&LM Budget By Customer Class C&LM Revenue By Customer Class Res. Income Eligible 13% Res. Income Eligible 13% C&I 58% Res. Non Income Eligible 29% C&I 57% Res. Non Income Eligible 30% Customer Class Budget ($,000) % of Total C&LM Budget % of Residential & C&I Budget % of Residential & C&I Revenue Difference Res. Income Eligible $21,634,035 12% 13% 13% 0% Res. Non Income Eligible $47,099,519 26% 29% 30% -1% Residential Subtotal $68,733,554 38% 43% 43% -1% C&I $92,702,081 52% 57% 57% 1% C&I Subtotal $92,702,081 52% 57% 57% 1% Residential and C&I Subtotal $161,435,635 90% 100% 100% 0% Other Expenditures Other Expenditures $17,451,819 10% Other Expenditures Subtotal $17,451,819 10% C&LM TOTAL $178,887, % CL&P $145,122,289 81% UI $33,765,165 19% 10

17 Table B Statewide Total Resource Costs and Benefits Table B Combined CL&P, UI, YGS, CNG, SCG Totals Costs Electricity Savings Natural Gas Savings Delivered Fuel Savings Oil & Propane Cost Customer Cost Total Resource Cost Electric Cost Gas Cost Program (000) (000) (000) (000) (000) Annual (MWh) Lifetime (MWh) Peak Impact (kw) Annual (ccf) Lifetime (ccf) Peak Impact (ccf) Annual Oil (gallons) Lifetime Oil (gallons) Annual Propane (gallons) Lifetime Propane (gallons) Total Annual MMBtu Total Annual Emissions Reduction (tons CO2) Total Resource Benefit (000) Residential Residential Retail Products $15,300 $0 $0 $7,094 $22,394 87, ,878 7, ,886 44,120 $102,575 Residential New Construction $1,705 $1,568 $95 $2,743 $6,111 2,117 35, ,700 4,941,939 1, , ,700 29,839 2,399 $7,258 Home Energy Solutions $11,579 $12,297 $7,618 $6,354 $37,848 16, ,470 2,217 1,793,077 35,061,794 16, ,987 13,774,826 58, , ,394 28,521 $93,283 HES Income Eligible $11,219 $8,941 $9,237 $1,242 $30,638 17, ,347 1,319 1,028,020 19,776,986 8, ,567 6,892,898 13, , ,881 19,045 $59,034 Water Heating $0 $948 $0 $2,400 $3, ,526 2,964, ,383 1,309 $2,172 Residential Behavior $3,300 $542 $0 $591 $4,433 28,472 63,485 7, ,424 1,454,241 1, ,140 15,268 $10,880 Subtotal Residential $43,103 $24,296 $16,949 $20,423 $104, ,895 1,193,098 19,214 3,398,747 64,199,758 29,085 1,155,554 20,667,724 77,841 1,402,951 1,035, ,662 $275,202 Commercial & Industrial Energy Conscious Blueprint $13,690 $6,374 $0 $7,982 $28,047 32, ,187 5,975 1,030,330 15,825,816 8, ,050 22,499 $72,452 Energy Opportunities $37,884 $3,241 $0 $58,176 $99,301 97,423 1,147,734 13, ,859 9,751,858 9, ,603 54,460 $156,702 Business & Energy Sustainability (O&M, RetroCx, BSC) $6,490 $1,661 $0 $8,200 $16,351 31, ,265 3, ,038 5,057,533 7, ,805 20,008 $32,911 PRIME $810 $0 $0 $46 $856 3,283 16, ,204 1,659 $4,736 Small Business $22,726 $515 $0 $24,028 $47,269 48, ,057 5, ,744 1,371,233 1, ,150 25,411 $76,276 Subtotal C&I $81,600 $11,791 $0 $98,432 $191, ,366 2,471,657 28,349 2,687,971 32,006,439 26, ,004, ,037 $343,078 Load Management ISO Load Response Program $3,400 $0 $0 $0 $3, , $7,433 Other Other $34,178 $7,025 $0 $0 $41, $0 TOTAL C&LM BUDGET $162,281 $43,113 $16,949 $118,855 $341, ,261 3,664, ,563 6,086,718 96,206,197 56,074 1,155,554 20,667,724 77,841 1,402,951 2,040, ,700 $625,713 CL&P used a discount rate of 7.52% and YGS used 7% for screening the benefits, based upon the Companies weighted after tax average cost of capital, and no less than minimum rate of 7% stated in Docket , DPUC Review of The Connecticut Gas Utilities Forecasts of Demand and Supply and Joint Conservation Plans and , DPUC Review of The Connecticut Energy Efficiency Fund's 2010 Conservation and Load Management Plan for UI, CNG and SCG utilized the same long-term nominal discount rate as the regional avoided cost study of 3.39%. 11

18 Table B Statewide Total Resource Costs and Benefits Table B Combined CL&P, UI, Yankee, CNG, SCG Totals Costs Electricity Savings Natural Gas Savings Delivered Fuel Savings Electric Cost Gas Cost Oil & Propane Cost Customer Cost Total Resource Cost Program (000) (000) (000) (000) (000) Annual (MWh) Lifetime (MWh) Peak Impact (kw) Annual (ccf) Lifetime (ccf) Peak Impact (ccf) Annual Oil (gallons) Lifetime Oil (gallons) Annual Propane (gallons) Lifetime Propane (gallons) Total Annual MMBtu Total Annual Emissions Reduction (tons CO2) Total Resource Benefit (000) Residential Residential Retail Products $15,800 $0 $0 $9,733 $25,533 72, ,095 6, ,148 36,457 $88,753 Residential New Construction $1,696 $1,637 $104 $1,396 $4,834 1,715 32, ,963 4,874,081 1, , ,488 26,457 2,078 $7,292 Home Energy Solutions $12,269 $12,049 $8,052 $8,909 $41,280 17, ,018 2,345 1,942,342 38,040,740 57, ,753 14,817,930 62,975 1,064, ,795 30,605 $107,062 HES Income Eligible $11,185 $8,506 $9,354 $1,882 $30,928 17, ,176 1, ,465 19,331,738 8, ,612 6,929,907 13, , ,629 18,788 $59,028 Water Heating $0 $963 $0 $3,503 $4, ,820 2,952, ,385 1,251 $2,052 Residential Behavior $3,300 $452 $0 $584 $4,336 45,752 98,045 10, ,424 1,454,241 1, ,117 24,003 $15,575 Subtotal Residential $44,250 $23,608 $17,511 $26,008 $111, ,516 1,095,020 21,471 3,476,015 66,653,654 70,083 1,218,365 21,747,837 82,231 1,480,473 1,061, ,183 $279,762 Commercial & Industrial Energy Conscious Blueprint $13,345 $6,916 $0 $7,825 $28,087 31, ,632 5,390 1,127,904 17,324,544 8, ,457 22,844 $72,513 Energy Opportunities $37,688 $3,655 $0 $57,647 $98,991 95,596 1,116,147 12, ,442 11,064,229 11, ,364 54,238 $155,193 Business & Energy Sustainability (O&M, RetroCx, BSC) $6,490 $1,857 $0 $8,993 $17,340 31, ,728 3, ,839 4,963,774 8, ,688 20,997 $33,888 PRIME $810 $0 $0 $45 $855 3,348 16, ,426 1,692 $6,954 Small Business $23,184 $563 $0 $24,128 $47,875 52, ,175 6, ,355 1,513,190 1, ,328 27,247 $82,223 Subtotal C&I $81,518 $12,991 $0 $98,639 $193, ,994 2,480,421 27,574 3,046,540 34,865,738 30, ,047, ,019 $350,771 Load Management ISO Load Response Program $3,000 $0 $0 $0 $3, , $7,774 Other Other $33,467 $6,902 $0 $0 $40, $0 TOTAL C&LM BUDGET $162,235 $43,501 $17,511 $124,647 $347, ,510 3,575, ,045 6,522, ,519, ,771 1,218,365 21,747,837 82,231 1,480,473 2,108, ,201 $638,307 CL&P used a discount rate of 7.52% and YGS used 7% for screening the benefits, based upon the Companies weighted after tax average cost of capital, and no less than minimum rate of 7% stated in Docket , DPUC Review of The Connecticut Gas Utilities Forecasts of Demand and Supply and Joint Conservation Plans and , DPUC Review of The Connecticut Energy Efficiency Fund's 2010 Conservation and Load Management Plan for UI, CNG and SCG utilized the same long-term nominal discount rate as the regional avoided cost study of 3.39%. 12

19 The Connecticut Light & Power Company Budget Tables 13

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21 Table A CL&P 2013 Actual Results, Budget Table A CL&P C&LM Budget CL&P CL&P CL&P CL&P C&LM BUDGET Actual Final Final Results Decision** Decision** 12/31/13 10/31/13 10/31/13 RESIDENTIAL Residential Retail Products Note 1 $ 6,509,496 $ 12,324,704 $ 12,540,391 Total - Consumer Products $ 6,509,496 $ 12,324,704 $ 12,540,391 Residential New Construction $ 1,433,966 $ 1,645,758 $ 1,652,216 Home Energy Solutions (HVAC, Duct Sealing, Lighting) $ 16,041,653 $ 11,733,143 $ 11,508,897 Home Energy Solutions Potential Allocation $ - $ 3,569,655 $ 4,367,674 HES Income Eligible $ 9,593,140 $ 17,201,791 $ 17,245,279 Residential Behavior $ - $ 3,000,000 $ 3,000,000 Subtotal Residential $ 33,578,255 $ 49,475,050 $ 50,314,457 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint $ 9,947,173 $ 9,913,103 $ 9,568,420 Total - Lost Opportunity $ 9,947,173 $ 9,913,103 $ 9,568,420 C&I LARGE RETROFIT Energy Opportunities $ 20,924,237 $ 32,030,505 $ 31,834,968 Business & Energy Sustainability (O&M, RetroCx, BSC) $ 1,649,654 $ 4,865,023 $ 4,865,023 PRIME $ 478,403 $ 660,000 $ 660,000 Total - C&I Large Retrofit $ 23,052,294 $ 37,555,528 $ 37,359,991 Small Business $ 13,329,552 $ 18,900,000 $ 19,357,951 Subtotal C&I $ 46,329,019 $ 66,368,631 $ 66,286,362 OTHER - EDUCATION * SmartLiving Center - Museum Partnerships $ 274,908 $ 1,091,259 $ 570,486 Clean Energy Communities $ 729,253 $ 1,364,040 $ 1,364,040 EE Smarts/K-12 Education $ 459,334 $ 479,126 $ 479,126 Customer Engagement $ - $ 480,000 $ 480,000 Science Center $ 150,392 $ - $ - Subtotal Education $ 1,613,887 $ 3,414,425 $ 2,893,652 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy (ECSU) $ 448,000 $ 358,400 $ 358,400 ESPC Project Manager - Lead By Example $ 38,734 $ 96,000 $ 96,000 Residential Loan Program (Includes ECLF) $ 416,865 $ 1,594,889 $ 2,053,121 C&I Loan Program $ 147,078 $ 1,087,227 $ 1,087,227 C&LM Loan Defaults $ 170,077 $ 105,000 $ 108,889 C&I Self-Funding $ - $ 4,000,000 $ 4,000,000 Subtotal Programs/Requirements $ 1,220,754 $ 7,241,515 $ 7,703,637 OTHER - LOAD MANAGEMENT ISO Load Response Program Note 2 $ 4,128,416 $ 3,400,000 $ 3,000,000 Subtotal Load Management $ 4,128,416 $ 3,400,000 $ 3,000,000 OTHER - RENEWABLES & RD&D Research, Development & Demonstration $ 198,218 $ 422,794 $ 442,308 Subtotal Renewables & RD&D $ 198,218 $ 422,794 $ 442,308 OTHER - ADMINISTRATIVE & PLANNING Administration $ 1,985,104 $ 907,271 $ 907,271 Marketing Plan $ 41,274 $ 1,626,667 $ 1,626,667 Planning $ 680,008 $ 703,170 $ 703,170 Evaluation $ 2,044,455 $ 2,263,634 $ 2,429,635 Evaluation Consultant $ - $ 233,243 $ 233,243 Information Technology $ 1,934,732 $ 1,338,112 $ 1,338,112 Energy Efficiency Board $ 475,046 $ 361,513 $ 361,513 Performance Management Fee $ 6,728,101 $ 6,858,063 $ 6,882,263 Subtotal Admin/Planning Expenditures $ 13,888,720 $ 14,291,673 $ 14,481,874 PROGRAM SUBTOTALS Residential $ 35,411,116 $ 55,198,637 $ 56,079,658 C&I $ 51,052,490 $ 75,969,251 $ 75,386,716 Other* $ 14,493,665 $ 13,446,201 $ 13,655,915 TOTAL $ 100,957,271 $ 144,614,089 $ 145,122,289 * OTHER -EDUCATION is primarily allocated to residential programs. ** The Budgets are the DEEP Approved Budgets from the October 31, 2013 Final Decision with technical corrections and some minor adjustments Note 1: Retail Products includes Retail Lighting and ENERGY STAR Appliances. Note 2: ISO-NE Load Response Customer payments are funded from the Forward Capacity Market 15

22 Table A 2014 Pie CL&P 2014 C&LM Budget and Parity Analysis Table A Pie Chart C&LM Budget By Customer Class Res. Income Eligible 13% C&LM Revenue By Customer Class Res. Income Eligible, 13% C&I Large 32% C&I Small/Med 26% Res. Non Income Eligible 29% C&I Large, 31% C&I Small/Med, 26% Res. Non Income Eligible, 30% Customer Class Budget % of Total C&LM Budget % of Residential & C&I % of Residential & C&I Difference Res. Income Eligible $17,701,791 12% 13% 13% 1% Res. Non Income Eligible $37,496,846 26% 29% 30% -2% Residential Subtotal $55,198,637 38% 42% 43% -1% C&I Small/Med $34,490,040 24% 26% 26% 1% C&I Large $41,479,211 29% 32% 31% 1% Budget Revenue C&I Subtotal $75,969,251 53% 58% 57% 1% C&I Non-Gov't 58% 57% Residential and C&I Subtotal $131,167,888 91% 100% 100% 0% Other Expenditures Other Expenditures $13,446,201 9% Other Expenditures Subtotal $13,446,201 9% C&LM TOTAL $144,614, % Note - Municipalities and state facilities are eligible to participate in C&I Program offerings as applicable. 16

23 Table A 2015 Pie CL&P 2015 C&LM Budget and Parity Analysis Table A Pie Chart C&LM Budget By Customer Class Res. Income Eligible 14% C&LM Revenue By Customer Class Res. Income Eligible, 13% C&I Large 31% C&I Small/Med 26% Res. Non Income Eligible 29% C&I Large, 31% C&I Small/Med, 26% Res. Non Income Eligible, 30% Customer Class Budget % of Total C&LM Budget % of Residential & C&I % of Residential & C&I Difference Res. Income Eligible $17,745,279 12% 13% 13% 1% Res. Non Income Eligible $38,334,379 26% 29% 30% -1% Residential Subtotal $56,079,658 39% 43% 43% -1% C&I Small/Med $34,225,569 24% 26% 26% 0% C&I Non-Gov't C&I Large $41,161,147 28% 31% 31% 0% Budget Revenue 57% 57% C&I Subtotal $75,386,716 52% 57% 57% 1% Residential and C&I Subtotal $131,466,374 91% 100% 100% 0% Other Expenditures Other Expenditures $13,655,915 9% Other Expenditures Subtotal $13,655,915 9% C&LM TOTAL $145,122, % Note - Municipalities and state facilities are eligible to participate in C&I Program offerings as applicable. 17

24 Table B CL&P Comparison of Program Energy Savings TABLE B-1, Energy Savings CL&P 2014 Electric Costs Utility Costs (Note 1) # of Units Units Program (000) (000) Annualized Savings (MWh) Lifetime Savings (MWh) RESIDENTIAL Peak kw Impact (Y/E) Electric Demand Cost $/kw Electric Demand Cost $/kw-yr Electric Cost Rate $/kwh Annualize Electric Cost Ratio $/LT-kWh Annual Oil Savings (gallons) Lifetime Oil Savings (gallons) Annual Propane Savings (gallons) Lifetime Propane Savings (gallons) Annual MMBtu Lifetime MMBtu Utility Cost per Annual MMBtu Utility Cost per lifetime MMBtu Residential Retail Products (Note 4) $12,325 $12,325 3,156,706 Products 70, ,239 6,121 $2,014 $260 $0.176 $ ,499 1,854,075 $51.46 $6.65 Residential New Construction $1,646 $1, Homes 1,937 33, $2,580 $149 $0.801 $ , ,701 7, ,451 $ $13.12 Home Energy Solutions (Note 2) $15,303 $9,446 18,963 Homes/other 13, ,893 1,666 $5,672 $451 $0.703 $ ,621 10,093,592 46, , ,862 2,045,795 $ $7.48 HES Income Eligible $17,202 $8,745 13,655 Homes 13, ,982 1,045 $8,367 $637 $0.635 $ ,168 5,413,724 10, ,963 86,296 1,388,338 $ $12.39 Residential Behavior (Note 3) $3,000 $3, ,000 Homes 27,655 55,310 7,144 $420 $210 $0.108 $ , ,771 $31.78 $15.89 Subtotal Residential $49,475 $35, , ,924 16,576 $2,116 $274 $0.276 $ ,790 15,507,316 61,817 1,099, ,096 5,602,429 $88.49 $8.83 COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint $9,913 $9, Projects 22, ,600 4,489 $2,208 $145 $0.431 $ ,439 1,193,184 $ $8.31 Energy Opportunities $32,031 $32, Projects 82, ,384 11,163 $2,869 $243 $0.389 $ ,901 3,322,158 $ $9.64 Business & Energy Sustainability (O&M, RetroCx, BSC) $4,865 $4, Projects 22, ,594 2,276 $2,138 $336 $0.213 $ , ,911 $62.30 $9.79 PRIME $660 $ Projects 2,683 13,414 0 $0 $0 $0.246 $ ,157 45,783 $72.08 $14.42 Small Business $18,900 $18, Projects 40, ,357 4,600 $4,108 $331 $0.463 $ ,465 1,731,610 $ $10.91 Subtotal C& I $66,369 $66, ,713 1,989,348 22,529 $2,946 $254 $0.387 $ ,057 6,789,646 $ $9.77 Load Management ISO Load Response Program $3,400 $3, Customers ,000 $36 $0 NA NA NA NA Subtotal Load Management $3,400 $3, ,000 $36 $0 NA NA NA NA Subtotal Other $25,370 $25,370 TOTAL C&LM BUDGET $144,614 $130, ,691 2,971, ,105 $971 $98 $0.436 $ ,790 15,507,316 61,817 1,099,441 1,145,154 12,392,076 $ $11.67 Note 1: Electric Costs are the estimated costs that are allocated to electric measures. The Electric Costs do not include costs that are allocated to oil and propane measures. Electric savings ratios are calculated using the Electric Costs only. MMBtu ratios are calculated using the Utility Cost. Note 2: Home Energy Solutions # of Units is 10,026 electric customers that participate in HES Core Services plus 8,937 HVAC rebates. Savings is based on spending of full HES budget include HES Allocation line item (Table C) Note 3: Behavior Program # of units includes 217,000 customers who will receive paper (mail) reports and 100,000 customers who receive electronic ( ) reports. Annualized savings figures include all new incremental savings plus those behavioral savings that would have decayed had the program been suspended. The lifetime savings figures include two years of persistence savings based on results from a persistence test conducted on a subset of CL&P s pilot HER program from , which found an average annual decay rate of 14%. These results are also broadly consistent with five independent evaluations covering four similar persistence tests conducted in other jurisdictions (Allcott and Rogers, 2012). Note 4: Retail Products # of units includes 694,525 LED Lighting Products (approximately 22%). 18

25 Table B CL&P Comparison of Program Benefits Residential Table B-2 Benefits Table, CL&P 2014 Program Costs Program Benefits (000) and Benefit/Cost Ratios Electric Benefit Fossil Fuel Other Benefits Program Budget a b c = b - a Total Resource Cost Customer Cost Electric Energy Transmission Distribution Capacity Intrastate DRIPE Rest of Pool DRIPE Capacity DRIPE Cross-fuel DRIPE Emissions Oil/Propane Water Non Resource Residential Retail Products $12,324,704 $16,981,514 $4,656,810 $28,544,534 $61,578 $1,345,896 $2,092,679 $6,471,535 $6,023,260 $638,365 $278,149 $20,070,806 $0 $0 $16,856,083 $82,382,885 Utility Cost B/C $12,324,704 n/a n/a n/a Total Resource B/C n/a $16,981,514 n/a Benefit Benefit/Cost Residential New Construction $1,645,758 $2,573,694 $927,936 $1,605,143 $15,941.8 $234,139.3 $547,287.4 $220,446 $232,878 $100,613 $9,710 $860,189 $180,944 $0 $0 $4,007,290 Utility Benefit Cost Test $1,645,758 n/a n/a n/a Total Resource Benefit Cost Test n/a $2,573,694 n/a Home Energy Solutions $15,302,798 $17,466,544 $2,163,746 $8,473,418 $22,927 $501,111 $1,017,107 $1,450,616 $1,484,082 $230,094 $62,538 $5,135,497 $26,574,693 $1,153,490 $2,284,790 $48,390,364 Utility Benefit Cost Test $15,302,798 n/a n/a n/a Total Resource Benefit Cost Test n/a $17,466,544 n/a HES Income Eligible $17,201,791 $17,305,417 $103,626 $9,232,939 $13,591 $297,046 $544,381 $1,643,443 $1,659,368 $172,224 $69,186 $5,580,040 $13,181,932 $297,798 $125,650 $32,817,599 Utility Benefit Cost Test $17,201,791 n/a n/a n/a Total Resource Benefit Cost Test n/a $17,305,417 n/a Residential Behavior $3,000,000 $3,000,000 $0 $3,272,034 $22,788 $498,068 $285,994 $704,441 $704,066 $0 $27,014 $2,750,469 $0 $0 $0 $8,264,874 Utility Benefit Cost Test $3,000,000 n/a n/a n/a Total Resource Benefit Cost Test n/a $3,000,000 n/a Sub Total Residential $49,475,051 $57,327,169 $7,852,118 $51,128,067 $136,826 $2,876,261 $4,487,448 $10,490,481 $10,103,654 $1,141,296 $446,598 $34,397,000 $39,937,570 $1,451,289 $19,266,523 $175,863,012 Utility Benefit Cost Test $49,475,051 n/a n/a n/a Total Resource Benefit Cost Test n/a $57,327,169 n/a Note: Commercial and Industrial programs are continued on the next page. 19

26 Table B CL&P Comparison of Program Benefits C&I Table B-2 Benefits Table, CL&P 2014 Program Costs Program Benefits (000) and Benefit/Cost Ratios Electric Benefit Fossil Fuel Other Benefits Program Budget a b c = b - a Total Resource Cost Customer Cost Electric Energy Transmission Distribution Capacity Intrastate DRIPE Rest of Pool DRIPE Capacity DRIPE Cross-fuel DRIPE Emissions Oil/Propane Water Non Resource Benefit Benefit/Cost Energy Conscious Blueprint $9,913,103 $11,785,289 $1,872,186 $18,115,948 $77,891 $1,702,442 $3,892,911 $2,727,182 $3,421,207 $816,965 $120,035 $10,634,567 $0 $0 $345,488 $41,854,636 Utility Benefit Cost Test $9,913,103 n/a n/a n/a Total Resource Benefit Cost Test n/a $11,785,289 n/a Energy Opportunities $32,030,505 $79,894,633 $47,864,128 $52,786,007 $165,656 $3,620,685 $7,364,234 $9,723,958 $12,335,149 $2,031,401 $429,862 $33,885,966 $0 $0 $2,765,546 $125,108,464 Utility Benefit Cost Test $32,030,505 n/a n/a n/a Total Resource Benefit Cost Test n/a $79,894,633 n/a O&M (Services, RetroCx, BSC) $4,865,023 $10,002,671 $5,137,648 $7,818,558 $17,991 $393,233 $360,505 $2,106,955 $2,664,289 $222,943 $101,370 $6,283,180 $0 $0 $0 $19,969,023 Utility Benefit Cost Test $4,865,023 n/a n/a n/a Total Resource Benefit Cost Test n/a $10,002,671 n/a PRIME $660,000 $705,553 $45,553 $748,919 $0 $0 $0 $207,972 $263,850 $0 $10,320 $599,155 $0 $0 $2,523,463 $4,353,679 Utility Benefit Cost Test $660,000 n/a n/a n/a Total Resource Benefit Cost Test n/a $705,553 n/a Small Business $18,900,000 $37,929,956 $19,029,956 $26,283,327 $68,684 $1,501,198 $3,069,261 $4,858,826 $6,055,680 $837,139 $213,424 $16,814,148 $0 $0 $1,574,039 $61,275,725 Utility Benefit Cost Test $18,900,000 n/a n/a n/a Total Resource Benefit Cost Test n/a $37,929,956 n/a Sub Total C&I $66,368,631 $140,318,101 $73,949,470 $105,752,759 $330,223 $7,217,558 $14,686,910 $19,624,893 $24,740,175 $3,908,447 $875,010 $68,217,015 $0 $0 $7,208,537 $252,561,528 Utility Benefit Cost Test $66,368,631 n/a n/a n/a Total Resource Benefit Cost Test n/a $140,318,101 n/a ISO Load Response $3,400,000 $3,400,000 $0 $0 $152,000 $3,325,000 $3,955,800 $0 $0 $0 $0 $0 $0 $0 $0 $7,432,800 Utility Benefit Cost Test $3,400,000 n/a n/a n/a Total Resource Benefit Cost Test n/a $3,400,000 n/a Other Costs $25,370,407 $25,370,407 - Total $144,614,089 $226,415,677 $81,801,588 $156,880,826 $619,049 $13,418,818 $23,130,159 $30,115,374 $34,843,829 $5,049,743 $1,321,608 $102,614,015 $39,937,570 $1,451,289 $26,475,061 $435,857,339 Utility Benefit Cost Test $144,614,089 n/a n/a n/a Total Resource Benefit Cost Test n/a $226,415,677 n/a CL&P used a discount rate of 7.52% and YGS used 7% for screening the benefits, based upon the Companies weighted after tax average cost of capital, and no less than minimum rate of 7% stated in Docket , DPUC Review of The Connecticut Gas Utilities Forecasts of Demand and Supply and Joint Conservation Plans and , DPUC Review of The Connecticut Energy Efficiency Fund's 2010 Conservation and Load Management Plan for

27 Table B CL&P Comparison of Programs Energy Savings TABLE B-1, Energy Savings CL&P 2015 Utility Cost per lifetime MMBtu Utility Cost per Annual MMBtu Lifetime MMBtu Annual MMBtu Lifetime Propane Savings (gallons) Annual Propane Savings (gallons) Lifetime Oil Savings (gallons) Annual Oil Savings (gallons) Electric Cost Ratio $/LT-kWh Electric Cost Rate $/kwh Annualize Electric Demand Cost $/kw-yr Electric Demand Cost $/kw Peak kw Impact (Y/E) Lifetime Savings (MWh) Annualized Savings (MWh) Electric Costs Utility Costs (Note 1) # of Units Units Program (000) (000) RESIDENTIAL $12, $12,540 2,902,002 Products 58, ,044 5,082 $2,468 $341 $0.215 $ ,776 1,437,024 $63.09 $8.73 Residential Retail Products (Note 4) $1, $1, Homes 1,550 30, $2,920 $149 $0.998 $ , ,707 5, ,746 $ $14.27 Residential New Construction $15, $9,804 19,646 Homes/other 13, ,107 1,722 $5,694 $455 $0.701 $ ,807 10,490,513 48, , ,109 2,124,782 $ $7.47 Home Energy Solutions ( Note2) $17, $8,682 13,539 Homes 13, ,616 1,039 $8,357 $629 $0.631 $ ,080 5,431,669 10, ,846 86,347 1,396,392 $ $12.35 HES Income Eligible $3, $3, ,000 Homes 44,935 89,870 10,696 $280 $140 $0.067 $ , ,725 $19.56 $9.78 Residential Behavior (Note3) Subtotal Residential $50,314 $35, , ,106 19,069 $1,866 $275 $0.269 $ ,887 15,922,181 63,908 1,136, ,357 5,380,669 $86.55 $9.35 COMMERCIAL & INDUSTRIAL $9,568 $9, Projects 22, ,263 3,914 $2,445 $161 $0.424 $ ,956 1,171,556 $ $8.17 Energy Conscious Blueprint $31,835 $31, Projects 80, ,740 10,933 $2,912 $246 $0.395 $ ,379 3,255,114 $ $9.78 Energy Opportunities $4,865 $4, Projects 23, ,029 2,276 $2,137 $334 $0.207 $ , ,050 $60.75 $9.50 O&M (Services, RetroCx, BSC) $660 $ Projects 2,748 13,739 0 $0 $0 $0.240 $ ,378 46,891 $70.38 $14.08 PRIME $19,358 $19, Projects 44, ,272 4,776 $4,054 $327 $0.437 $ ,300 1,878,078 $ $10.31 Small Business Subtotal C& I $66,286 $66, ,775 2,011,043 21,899 $3,027 $262 $0.381 $ ,094 6,863,688 $ $9.66 LOAD MANAGEMENT $3,000 $3, Customers ,000 $32 $0 NA NA NA NA ISO Load Response Program Subtotal Load Management $3,000 $3, ,000 $32 $0 NA NA NA NA Other $25,521 $25,521 Subtotal Other TOTAL C&LM BUDGET $145,122 $130, ,240 2,910, ,967 $959 $101 $0.426 $ ,045,196 9,932,336 $ $14.61 Note 1: Electric Costs are the estimated costs that are allocated to electric measures. The Electric Costs do not include costs that are allocated to oil and propane measures. Electric savings ratios are calculated using the Electric Costs for HES only. MMBtu ratios are calculated using the Utility Cost. Note 2: Home Energy Solutions # of Units is 10,709 electric customers that participate in HES Core Services plus 8,937 HVAC rebates. Savings is based on spending of full HES budget include HES Allocation line item (Table C) Note 3: Behavior Program # of units includes 217,000 customers who will receive paper (mail) reports and 100,000 customers who receive electronic ( ) reports. Annualized savings figures include all new incremental savings plus those behavioral savings that would have decayed had the program been suspended. The lifetime savings figures include two years of persistence savings based on results from a persistence test conducted on a subset of CL&P s pilot HER program from , which found an average annual decay rate of 14%. These results are also broadly consistent with five independent evaluations covering four similar persistence tests conducted in other jurisdictions (Allcott and Rogers, 2012). Note 4: Retail Products # of units includes 967,512 LED Lighting Products (approximately 33.3 %). 21

28 Table B CL&P Comparison of Program Benefits Residential Table B-2 Benefits Table, CL&P 2015 Program Budget Program Costs Program Benefits (000) and Benefit/Cost Ratios Electric Benefit Fossil Fuel Other Benefits a b c = b - a Total Resource Cost Customer Cost Electric Energy Transmission Distribution Capacity Intrastate DRIPE Rest of Pool DRIPE Capacity DRIPE Cross-fuel DRIPE Emissions Oil/Propane Water Non Resource Benefit Benefit/Cost Residential Retail Products $12,540,391 $20,127,799 $7,587,408 $23,238,051 $50,417 $1,101,943 $1,897,599 $5,131,986 $4,805,249 $582,652 $230,040 $16,310,097 $0 $0 $17,672,777 $71,020,813 Utility Cost B/C $12,540,391 n/a n/a n/a Total Resource B/C n/a $20,127,799 n/a Residential New Construction $1,652,216 $1,890,395 $238,179 $1,283,023 $10,624.2 $631,714.8 $621,688.5 $140,538 $149,053 $91,979 $7,148 $627,478 $197,512 $0 $0 $3,760,759 Utility Benefit Cost Test $1,652,216 n/a n/a n/a Total Resource Benefit Cost Test n/a $1,890,395 n/a Home Energy Solutions $15,876,571 $18,134,491 $2,257,920 $9,213,774 $23,917 $522,756 $1,179,156 $1,367,586 $1,407,314 $244,137 $60,655 $5,295,190 $33,968,165 $1,253,621 $2,382,784 $56,919,055 Utility Benefit Cost Test $15,876,571 n/a n/a n/a Total Resource Benefit Cost Test n/a $18,134,491 n/a HES Income Eligible $17,245,279 $17,245,279 $0 $9,763,601 $13,781 $301,202 $637,973 $1,456,065 $1,479,848 $177,352 $63,064 $5,568,415 $13,703,010 $304,950 $124,644 $33,593,905 Utility Benefit Cost Test $17,245,279 n/a n/a n/a Total Resource Benefit Cost Test n/a $17,245,279 n/a Residential Behavior $3,000,000 $3,000,000 $0 $5,332,140 $34,802 $760,665 $425,440 $1,139,010 $1,145,110 $0 $57,689 $4,507,986 $0 $0 $0 $13,402,842 Utility Benefit Cost Test $3,000,000 n/a n/a n/a Total Resource Benefit Cost Test n/a $3,000,000 n/a Sub Total Residential $50,314,457 $60,397,964 $10,083,507 $48,830,589 $133,542 $3,318,282 $4,761,855 $9,235,185 $8,986,575 $1,096,120 $418,597 $32,309,167 $47,868,687 $1,558,572 $20,180,205 $178,697,374 Utility Benefit Cost Test $50,314,457 n/a n/a n/a Total Resource Benefit Cost Test n/a $60,397,964 n/a Note: Commercial and Industrial programs are continued on the next page. 22

29 Table B CL&P Comparison of Program Benefits C&I Table B-2 Benefits Table, CL&P 2015 Program Budget Program Costs Program Benefits (000) and Benefit/Cost Ratios Electric Benefit Fossil Fuel Other Benefits a b c = b - a Total Resource Cost Customer Cost Electric Energy Transmission Distribution Capacity Intrastate DRIPE Rest of Pool DRIPE Capacity DRIPE Cross-fuel DRIPE Emissions Oil/Propane Water Non Resource Benefit Benefit/Cost Energy Conscious Blueprint $9,568,420 $11,336,351 $1,767,931 $18,735,507 $69,487 $1,518,749 $3,842,550 $2,367,037 $2,986,940 $738,118 $105,882 $10,336,523 $0 $0 $288,427 $40,989,221 Utility Benefit Cost Test $9,568,420 n/a n/a n/a Total Resource Benefit Cost Test n/a $11,336,351 n/a Energy Opportunities $31,834,968 $79,216,659 $47,381,691 $54,606,324 $165,795 $3,623,712 $8,394,448 $8,442,340 $10,773,707 $2,061,854 $378,885 $32,934,174 $0 $0 $2,802,462 $124,183,701 Utility Benefit Cost Test $31,834,968 n/a n/a n/a Total Resource Benefit Cost Test n/a $79,216,659 n/a Business & Energy Sustainability (O&M, RetroCx, BSC) $4,865,023 $10,593,625 $5,728,602 $8,491,765 $18,355 $401,184 $492,852 $2,080,595 $2,643,886 $231,156 $99,392 $6,413,114 $0 $0 $0 $20,872,299 Utility Benefit Cost Test $4,865,023 n/a n/a n/a Total Resource Benefit Cost Test n/a $10,593,625 n/a PRIME $660,000 $705,253 $45,253 $795,059 $0 $0 $0 $207,741 $264,699 $0 $10,566 $618,880 $0 $0 $4,673,080 $6,570,024 Utility Benefit Cost Test $660,000 n/a n/a n/a Total Resource Benefit Cost Test n/a $705,253 n/a Small Business $19,357,951 $38,448,864 $19,090,913 $30,059,713 $72,725 $1,589,531 $3,691,973 $4,658,991 $5,842,590 $900,629 $208,169 $18,083,801 $0 $0 $1,664,872 $66,772,994 Utility Benefit Cost Test $19,357,951 n/a n/a n/a Total Resource Benefit Cost Test n/a $38,448,864 n/a Sub Total C&I $66,286,362 $140,300,752 $74,014,390 $112,688,368 $326,362 $7,133,176 $16,421,824 $17,756,704 $22,511,822 $3,931,757 $802,894 $68,386,492 $0 $0 $9,428,841 $259,388,239 Utility Benefit Cost Test $66,286,362 n/a n/a n/a Total Resource Benefit Cost Test n/a $140,300,752 n/a ISO Load Response $3,000,000 $3,000,000 $0 $0 $154,850 $3,391,500 $4,227,500 $0 $0 $0 $0 $0 $0 $0 $0 $7,773,850 Utility Benefit Cost Test $3,000,000 n/a n/a n/a Total Resource Benefit Cost Test n/a $3,000,000 n/a Other Costs $25,521,470 $25,521,470 - Total $145,122,289 $229,220,186 $84,097,897 $161,518,957 $614,754 $13,842,958 $25,411,179 $26,991,888 $31,498,396 $5,027,877 $1,221,491 $100,695,658 $47,868,687 $1,558,572 $29,609,046 $445,859,464 Utility Benefit Cost Test $145,122,289 n/a n/a n/a Total Resource Benefit Cost Test n/a $229,220,186 n/a CL&P used a discount rate of 7.52% and YGS used 7% for screening the benefits, based upon the Companies weighted after tax average cost of capital, and no less than minimum rate of 7% stated in Docket , DPUC Review of The Connecticut Gas Utilities Forecasts of Demand and Supply and Joint Conservation Plans and , DPUC Review of The Connecticut Energy Efficiency Fund's 2010 Conservation and Load Management Plan for

30 Table C 2014 CL&P Budget CL&P C&LM BUDGET ($000) CL&P Labor Table C CL&P 2014 C&LM Budget Details Materials & Supplies Outside Services Contractor Labor Incentives Marketing Other ** Administrative Expenses TOTAL Residential Retail Products $ 166 $ 4 $ 1,749 $ - $ 9,314 $ 1,023 $ 39 $ 28 $ 12,325 Appliance Rebate Program $ - $ - $ - $ - $ - $ - $ - $ - $ - Total - Consumer Products $ 166 $ 4 $ 1,749 $ - $ 9,314 $ 1,023 $ 39 $ 28 $ 12,325 Residential New Construction $ 163 $ 3 $ 61 $ - $ 1,374 $ 36 $ 4 $ 5 $ 1,646 Home Energy Solutions (HVAC, Duct Sealing, Lighting) $ 1,500 $ 21 $ 256 $ - $ 9,514 $ 354 $ 44 $ 44 $ 11,733 Home Energy Solutions - Potential Allocation $ 500 $ 6 $ 78 $ - $ 2,851 $ 108 $ 13 $ 13 $ 3,570 HES Income Eligible $ 1,400 $ 27 $ 372 $ - $ 14,638 $ 652 $ 45 $ 68 $ 17,202 Residential Behavior $ 150 $ 25 $ 2,280 $ - $ - $ 500 $ 25 $ 20 $ 3,000 Subtotal Residential $ 3,879 $ 86 $ 4,797 $ - $ 37,690 $ 2,672 $ 172 $ 179 $ 49,475 COMMERCIAL & INDUSTRIAL C & I LOST OPPORTUNITY Energy Conscious Blueprint $ 1,912 $ 11 $ 529 $ - $ 7,097 $ 229 $ 80 $ 55 $ 9,913 Total - Lost Opportunity $ 1,912 $ 11 $ 529 $ - $ 7,097 $ 229 $ 80 $ 55 $ 9,913 C & I LARGE RETROFIT Energy Opportunities $ 3,001 $ 48 $ 690 $ - $ 27,414 $ 572 $ 29 $ 277 $ 32,031 Business & Energy Sustainability (O&M, RetroCx, BSC) $ 513 $ 10 $ 808 $ - $ 3,392 $ 102 $ 15 $ 25 $ 4,865 PRIME $ 100 $ 2 $ 25 $ - $ 456 $ 61 $ 4 $ 12 $ 660 Total - C&I Large Retrofit $ 3,614 $ 60 $ 1,522 $ - $ 31,262 $ 735 $ 48 $ 315 $ 37,556 Small Business $ 1,400 $ 20 $ 149 $ - $ 13,818 $ 298 $ 15 $ 3,200 $ 18,900 Subtotal C&I $ 6,926 $ 92 $ 2,200 $ - $ 52,176 $ 1,262 $ 142 $ 3,570 $ 66,369 OTHER - EDUCATION SmartLiving Center - Museum Partnerships $ 50 $ 40 $ 986 $ - $ - $ 15 $ - $ - $ 1,091 Clean Energy Communities $ 250 $ 20 $ 987 $ - $ - $ 100 $ 5 $ 2 $ 1,364 EE Smarts/K-12 Education $ 50 $ 5 $ 371 $ - $ - $ 50 $ - $ 3 $ 479 Customer Engagement $ 50 $ - $ 430 $ - $ - $ - $ - $ - $ 480 Science Center $ - $ - $ - $ - $ - $ - $ - $ - $ - Subtotal Education $ 400 $ 65 $ 2,774 $ - $ - $ 165 $ 5 $ 5 $ 3,414 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy (ECSU) $ - $ - $ - $ - $ - $ - $ 359 $ - $ 359 ESPC Project Manager - Lead By Example $ - $ - $ 96 $ - $ - $ - $ - $ - $ 96 Other Funding Requests $ - $ - $ - $ - $ - $ - $ - $ - $ - Residential Loan Program (Includes ECLF) $ - $ - $ 1,595 $ - $ - $ - $ - $ - $ 1,595 C&I Loan Program $ - $ - $ 1,087 $ - $ - $ - $ - $ - $ 1,087 C&LM Loan Defaults $ - $ - $ - $ - $ - $ - $ 105 $ - $ 105 C&I Self Funding $ - $ - $ - $ - $ - $ - $ 4,000 $ - $ 4,000 Subtotal Programs/Requirements $ - $ - $ 2,778 $ - $ - $ - $ 4,464 $ - $ 7,242 OTHER - LOAD MANAGEMENT ISO Load Response Program $ 249 $ 5 $ 743 $ 9 $ 2,372 $ 10 $ - $ 12 $ 3,400 Subtotal Load Management $ 249 $ 5 $ 743 $ 9 $ 2,372 $ 10 $ - $ 12 $ 3,400 OTHER - RENEWABLES & RD&D Research, Development & Demonstration $ 150 $ 2 $ 216 $ - $ - $ - $ 50 $ 5 $ 423 Subtotal Renewables & RD&D $ 150 $ 2 $ 216 $ - $ - $ - $ 50 $ 5 $ 423 OTHER - ADMINISTRATIVE & PLANNING Administration $ 797 $ 4 $ 46 $ - $ - $ - $ 30 $ 30 $ 907 Marketing Plan $ 330 $ - $ - $ - $ - $ 1,295 $ 1 $ 1 $ 1,627 Planning $ 578 $ 6 $ 80 $ - $ - $ - $ 20 $ 19 $ 703 Evaluation $ 190 $ 5 $ 2,009 $ - $ - $ - $ 55 $ 5 $ 2,264 Evaluation Consultant $ - $ - $ 233 $ - $ - $ - $ - $ - $ 233 Information Technology $ 300 $ 5 $ 853 $ 100 $ - $ - $ - $ 80 $ 1,338 Energy Efficiency Board $ - $ - $ 362 $ - $ - $ - $ - $ - $ 362 Performance Management Fee $ - $ - $ - $ - $ - $ - $ 6,858 $ - $ 6,858 Subtotal Admin/Planning Expenditures $ 2,195 $ 20 $ 3,582 $ 100 $ - $ 1,295 $ 6,964 $ 135 $ 14,291 PROGRAM SUBTOTALS Residential $ 4,473 $ 139 $ 8,686 $ - $ 37,690 $ 3,850 $ 176 $ 184 $ 55,199 C&I $ 7,311 $ 109 $ 4,607 $ 9 $ 54,548 $ 1,554 $ 4,249 $ 3,583 $ 75,969 Other* $ 2,015 $ 22 $ 3,798 $ 100 $ - $ - $ 7,372 $ 139 $ 13,447 TOTAL C&LM BUDGET $ 13,800 $ 270 $ 17,091 $ 109 $ 92,239 $ 5,404 $ 11,797 $ 3,906 $ 144,614 * Other -includes ISE/ECSU, RD&D, Admin, Planning & Evaluation, and IT ** Other includes Performance Management Fee, ECSU, Energy Conservation Loan Fund, Loan Defaults, Self Funding 24

31 Table C 2014 Pie CL&P 2014 CONSERVATION & LOAD MANAGEMENT C&LM Budget By Expense Class Table C Pie Chart Other 8% Administrative Expenses 3% NU Labor 9% Materials & Supplies 0% Marketing 4% Outside Services 12% Other Labor 0% Incentives 64% Expense Classes Budget % of Budget NU Labor $ 13,800 10% Materials & Supplies $ 270 0% Outside Services $ 17,091 12% Other Labor $ 109 0% Incentives $ 92,239 64% Marketing $ 5,404 4% Other $ 11,797 8% Administrative Expenses $ 3,906 3% Total $ 144, % 25

32 Table C 2015 CL&P Budget CL&P C&LM BUDGET ($000) CL&P Labor Table C CL&P 2015 C&LM Budget Details Materials & Supplies Outside Services Contractor Labor Incentives Marketing Other ** Administrative Expenses TOTAL Residential Retail Products $ 171 $ 5 $ 1,773 $ - $ 9,484 $ 1,038 $ 40 $ 29 $ 12,540 Appliance Rebate Program $ - $ - $ - $ - $ - $ - $ - $ - $ - Total - Consumer Products $ 171 $ 5 $ 1,773 $ - $ 9,484 $ 1,038 $ 40 $ 29 $ 12,540 Residential New Construction $ 168 $ 3 $ 61 $ - $ 1,375 $ 36 $ 4 $ 5 $ 1,652 Home Energy Solutions (HVAC, Duct Sealing, Lighting) $ 1,545 $ 21 $ 252 $ - $ 9,258 $ 347 $ 43 $ 43 $ 11,509 Home Energy Solutions - Potential Allocation $ 515 $ 8 $ 80 $ - $ 3,600 $ 132 $ 16 $ 16 $ 4,368 HES Income Eligible $ 1,442 $ 27 $ 380 $ - $ 14,630 $ 653 $ 45 $ 68 $ 17,245 Residential Behavior / Engagement $ 155 $ 25 $ 2,276 $ - $ - $ 500 $ 25 $ 20 $ 3,000 Subtotal Residential $ 3,996 $ 89 $ 4,821 $ - $ 38,348 $ 2,706 $ 175 $ 181 $ 50,315 COMMERCIAL & INDUSTRIAL C & I LOST OPPORTUNITY Energy Conscious Blueprint $ 1,969 $ 11 $ 529 $ - $ 6,708 $ 221 $ 77 $ 53 $ 9,568 Total - Lost Opportunity $ 1,969 $ 11 $ 529 $ - $ 6,708 $ 221 $ 77 $ 53 $ 9,568 C & I LARGE RETROFIT Energy Opportunities $ 3,091 $ 47 $ 685 $ - $ 27,138 $ 568 $ 28 $ 277 $ 31,835 Business & Energy Sustainability (O&M, RetroCx, BSC) $ 528 $ 10 $ 808 $ - $ 3,377 $ 102 $ 15 $ 25 $ 4,865 PRIME $ 103 $ 2 $ 25 $ - $ 453 $ 61 $ 4 $ 12 $ 660 Total - C&I Large Retrofit $ 3,722 $ 60 $ 1,518 $ - $ 30,967 $ 731 $ 47 $ 314 $ 37,360 Small Business $ 1,442 $ 20 $ 153 $ - $ 13,862 $ 306 $ 15 $ 3,560 $ 19,358 Subtotal C&I $ 7,134 $ 91 $ 2,199 $ - $ 51,537 $ 1,258 $ 140 $ 3,927 $ 66,286 OTHER - EDUCATION SmartLiving Center - Museum Partnerships $ 52 $ 40 $ 464 $ - $ - $ 15 $ - $ - $ 570 Clean Energy Communities $ 258 $ 20 $ 980 $ - $ - $ 100 $ 5 $ 2 $ 1,364 EE Smarts/K-12 Education $ 52 $ 5 $ 370 $ - $ - $ 50 $ - $ 3 $ 479 Customer Engagement $ 52 $ - $ 429 $ - $ - $ - $ - $ - $ 480 Science Center $ - $ - $ - $ - $ - $ - $ - $ - $ - Subtotal Education $ 412 $ 65 $ 2,242 $ - $ - $ 165 $ 5 $ 5 $ 2,894 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy (ECSU) $ - $ - $ - $ - $ - $ - $ 358 $ - $ 358 ESPC Project Manager - Lead By Example $ - $ - $ 96 $ - $ - $ - $ - $ - $ 96 Other Funding Requests $ - $ - $ - $ - $ - $ - $ - $ - $ - Residential Loan Program $ - $ - $ 2,053 $ - $ - $ - $ - $ - $ 2,053 C&I Loan Program $ - $ - $ 1,087 $ - $ - $ - $ - $ - $ 1,087 C&LM Loan Defaults $ - $ - $ - $ - $ - $ - $ 109 $ - $ 109 C&I Self Funding $ - $ - $ - $ - $ - $ - $ 4,000 $ - $ 4,000 Subtotal Programs/Requirements $ - $ - $ 3,236 $ - $ - $ - $ 4,467 $ - $ 7,703 OTHER - LOAD MANAGEMENT ISO Load Response Program $ 257 $ 5 $ 743 $ 9 $ 1,964 $ 10 $ - $ 12 $ 3,000 Subtotal Load Management $ 257 $ 5 $ 743 $ 9 $ 1,964 $ 10 $ - $ 12 $ 3,000 OTHER - RENEWABLES & RD&D Research, Development & Demonstration $ 155 $ 2 $ 231 $ - $ - $ - $ 50 $ 5 $ 442 Subtotal Renewables & RD&D $ 155 $ 2 $ 231 $ - $ - $ - $ 50 $ 5 $ 442 OTHER - ADMINISTRATIVE & PLANNING Administration $ 821 $ 4 $ 46 $ - $ - $ - $ 15 $ 21 $ 907 Marketing Plan $ 340 $ - $ - $ - $ - $ 1,285 $ 1 $ 1 $ 1,627 Planning $ 596 $ 6 $ 80 $ - $ - $ - $ 10 $ 12 $ 704 Evaluation $ 196 $ 5 $ 2,169 $ - $ - $ - $ 55 $ 5 $ 2,430 Evaluation Consultant $ - $ - $ 233 $ - $ - $ - $ - $ - $ 233 Information Technology $ 309 $ 5 $ 844 $ 100 $ - $ - $ - $ 80 $ 1,338 Energy Efficiency Board $ - $ - $ 362 $ - $ - $ - $ - $ - $ 362 Performance Management Fee $ - $ - $ - $ - $ - $ - $ 6,882 $ - $ 6,882 Subtotal Admin/Planning Expenditures $ 2,261 $ 20 $ 3,734 $ 100 $ - $ 1,285 $ 6,963 $ 119 $ 14,482 PROGRAM SUBTOTALS Residential $ 4,607 $ 142 $ 8,741 $ - $ 38,348 $ 3,875 $ 179 $ 187 $ 56,080 C&I $ 7,530 $ 108 $ 4,500 $ 9 $ 53,501 $ 1,548 $ 4,250 $ 3,940 $ 75,387 Other* $ 2,076 $ 22 $ 3,965 $ 100 $ - $ - $ 7,370 $ 123 $ 13,656 TOTAL C&LM BUDGET $ 14,214 $ 272 $ 17,206 $ 109 $ 91,849 $ 5,423 $ 11,800 $ 4,250 $ 145,122 * Other -includes ISE/ECSU, RD&D, Admin, Planning & Evaluation, and IT ** Other includes Performance Management Fee, ECSU, Energy Conservation Loan Fund, Loan Defaults, Self Funding 26

33 Table C 2015 Pie CL&P 2015 CONSERVATION & LOAD MANAGEMENT C&LM Budget By Expense Class Table C Pie Chart Other 8% Administrative Expenses 3% NU Labor 10% Materials & Supplies 0% Marketing 4% Outside Services 12% Other Labor 0% Incentives 63% Expense Classes Budget % of Budget NU Labor $ 14,214 10% Materials & Supplies $ 272 0% Outside Services $ 17,206 12% Other Labor $ 109 0% Incentives $ 91,849 63% Marketing $ 5,423 4% Other $ 11,800 8% Administrative Expenses $ 4,250 3% Total $ 145, % 27

34 Table D CL&P Historical and Projected Program Expenditures Table D CL&P Historical and Projected $ Expenditures $ RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Budget Budget Residential Retail Products 7,927,588 8,178,824 6,955,000 3,154,881 6,001,655 6,440,269 5,626,761 5,961,939 4,903,424 3,223,833 8,764,502 7,782,387 6,859,521 6,509,496 12,324,704 12,540,391 Appliance Retirement - - 1,446,975 2,034,265 1,188, ,935 - Appliance Rebate Program 3,615,349 3,502 - Customer Initiated Projects , ,182 - Total - Consumer Products 7,927,588 8,178,824 6,955,000 3,154,881 7,693,563 8,803,716 6,815,397 5,961,939 5,172,359 3,223,833 12,379,851 7,785,889 6,859,521 6,509,496 12,324,704 12,540,391 Residential New Construction 1,507,898 1,951,289 1,646,000 1,115, ,514 1,187,496 1,688,185 1,414,189 1,563, ,394 1,034,433 1,638,211 1,338,928 1,433,966 1,645,758 1,652,216 Home Energy Solutions (HVAC, Duct Sealing, Lighting) 5,043,364 3,932,896 3,012,000 1,462,685 1,438,871 2,029,289 4,313,563 5,467,875 7,167,887 7,949,519 22,409,603 14,981,521 14,520,592 16,041,653 15,302,798 15,876,571 HES Income Eligible 4,405,568 5,035,856 4,716,000 3,180,815 4,590,734 4,682,547 5,298,638 7,112,363 7,035,693 7,758,362 9,361,764 12,900,111 12,143,928 9,593,140 17,201,791 17,245,279 Residential Behavior - 3,000,000 3,000,000 Subtotal RESIDENTIAL 18,884,418 19,098,865 16,329,000 8,914,107 14,490,682 16,703,048 18,115,783 19,956,366 20,939,578 19,426,108 45,185,651 37,305,732 34,862,969 33,578,255 49,475,050 50,314,457 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 17,458,797 17,107,120 15,905,000 10,410,843 14,479,658 12,468,319 9,448,615 13,084,740 18,460,585 6,756,126 8,033,028 8,395,733 8,504,845 9,947,173 9,913,103 9,568,420 Total - Lost Opportunity 17,458,797 17,107,120 15,905,000 10,410,843 14,479,658 12,468,319 9,448,615 13,084,740 18,460,585 6,756,126 8,033,028 8,395,733 8,504,845 9,947,173 9,913,103 9,568,420 C&I LARGE RETROFIT C&I RFP 2,417,338 6,320,213 4,268,000 2,049,863 4,037,727 9,176,612 Energy Opportunities 947,128 1,188,615 1,052, , ,245 1,026,898 9,081,115 22,928,130 29,565,748 10,231,492 17,863,695 23,690,549 18,722,462 20,924,237 32,030,505 31,834,968 Business & Energy Sustainability (O&M, RetroCx, BSC) 3,662,535 2,822, , , ,762 1,833,005 1,435,302 1,113,822 1,929,890 1,100,065 1,347,241 2,617,944 1,696,269 1,649,654 4,865,023 4,865,023 PRIME 394, , , , , , ,000 Municipal Energy & Schools 6,072,509 4,385,010 3,663,000 2,288,449 6,718,880 4,401,007 Total - C&I Large Retrofit 13,099,510 14,715,865 9,600,486 5,555,614 12,467,614 16,437,522 10,516,417 24,041,952 31,495,638 11,725,847 19,687,563 26,797,455 20,959,484 23,052,294 37,555,528 37,359,991 Small Business 852,278 2,437,151 2,812,000 2,167,157 3,263,609 2,710,538 7,497,147 10,204,353 11,390,772 4,879,517 12,100,944 11,926,131 11,795,666 13,329,552 18,900,000 19,357,951 Subtotal C&I 31,410,585 34,260,136 28,317,486 18,133,614 30,210,881 31,616,379 27,462,179 47,331,045 61,346,995 23,361,491 39,821,535 47,119,319 41,259,995 46,329,019 66,368,631 66,286,362 OTHER -EDUCATION SmartLiving Center - Museum Partnerships 1,885,971 1,050, , ,526 61,519 80,760 86, , ,047 92, , , , ,908 1,091, ,486 Science Center 200, ,200 67, , , , , EE Smarts/K-12 Education - 159, , ,053 61, , , , , , , , , , , ,126 Clean Energy Communities / Behavior Pilot 46, , , , ,253 1,364,040 1,364,040 Customer Engagement 480, ,000 Community Based Program (SWCT) - 84, ,000 73,081 96, , , ,080 Subtotal Education 1,885,971 1,294,630 1,613, , , , , , , ,021 1,423, ,253 1,425,692 1,613,887 3,414,425 2,893,652 OTHER -PROGRAMS/REQUIREMENTS Institute for Sustainable Energy (ECSU) - 500,000 1,200, , , , , , , , , , , , , ,400 ESPC Project Manager - Lead By Example 38,734 96,000 96,000 Residential Loan Program (includes ECLF) 18,285 18,569,958 3,097,816 5,924, ,865 1,594,889 2,053,121 C&I Loan Program 9, ,898 56, , ,078 1,087,227 1,087,227 Other Funding Requests 325, C&I Self Funding 4,000,000 4,000,000 C&LM Loan Defaults , ,126 71,592 57,267 37, , ,056 77,739 93, , , ,889 Subtotal Other Programs/Requirements - 500,000 1,200, , , , , , , ,741 19,610,297 3,680,355 7,167,975 1,220,754 7,241,515 7,703,637 OTHER - LOAD MANAGEMENT ISO Load Response Program 1,799,063 1,270,440 1,722,000 2,436, ,233 1,411,769 1,241, , , ,909 2,864,364 4,955,923 3,740,450 4,128,416 3,400,000 3,000,000 Demand Reduction ,454 62,067 12,663 9,513 Power Factor , , , ,901 64,128 Wait Until 8: , ,000 Subtotal Load Management 1,799,063 1,270,440 1,722,000 2,436, ,326 2,050,843 1,377, , , ,909 2,864,364 4,955,923 3,740,450 4,128,416 3,400,000 3,000,000 OTHER - RENEWABLES & RD&D Renewables Incentives - - 7,898 3,019 Research, Development & Demonstration 4,225,666 5,066,146 3,943,000 1,721,585 1,117, ,597 (22,769) 131, ,559 75, ,434 86, , , , ,308 Subtotal Renewables & RD&D 4,225,666 5,066,146 3,943,000 1,721,585 1,125, ,616 (22,769) 131, ,559 75, ,434 86, , , , ,308 OTHER - ADMINISTRATIVE & PLANNING Administration 1,426,189 1,325, ,000 2,330, , , , , , , , ,467 1,539,439 1,985, , ,271 Marketing Plan 284,419 67, ,292 3,618 5,804 63,349 17, ,324 41,274 1,626,667 1,626,667 Planning and Evaluation 1,768,498 1,589,736 1,304, , ,799 2,008,477 1,138, ,975 1,433,843 1,617,773 2,053, ,537 2,860,865 2,724,463 2,966,805 3,132,805 Evaluation Consultant 233, ,243 Information Technology 962,564 1,070,723 1,278, , , ,572 1,812,738 1,656,432 1,636,204 1,268,936 1,810,543 1,764,932 2,244,144 1,934,732 1,338,112 1,338,112 Energy Efficiency Board 72,562 99,128 58, ,321 98, , , , , , , , , , , ,513 Audit ,459 Performance Management Fee 3,557,100 4,120,100 3,486,900 2,180,501 3,937,752 3,866,548 4,056,741 4,788,385 3,903,735 2,239,767 5,474,571 3,773,709 6,758,883 6,728,101 6,858,063 6,882,263 Admin/Planning Expenditures 7,786,913 8,204,934 7,057,900 5,878,508 6,418,238 8,085,733 8,058,857 8,588,617 8,040,397 6,248,547 10,669,378 7,886,425 14,465,518 13,888,720 14,291,673 14,481,874 PROGRAM SUB-TOTALS Residential 20,393,195 20,166,430 17,662,400 9,455,646 14,888,079 17,632,785 18,725,643 20,914,521 21,408,083 19,922,869 65,011,019 41,210,429 42,470,242 35,411,116 55,198,637 56,079,658 C&I 33,586,842 35,757,641 30,319,086 20,643,356 30,673,832 33,842,058 29,024,118 48,215,129 61,970,085 23,650,206 43,231,922 52,338,209 46,107,163 51,052,490 75,969,251 75,386,716 Other 12,012,579 13,771,080 12,200,900 8,550,093 8,259,631 8,834,321 8,211,068 8,539,545 8,471,338 6,717,830 11,433,848 8,403,628 14,521,910 14,493,665 13,446,201 13,655,915 TOTAL (includes ISO Load Response) 65,992,616 69,695,151 60,182,386 38,649,095 53,821,542 60,309,164 55,960,829 77,669,195 91,849,506 50,290, ,676, ,952, ,099, ,957, ,614, ,122,289 TOTAL (excludes ISO Load Response) 64,193,553 68,424,711 58,460,386 36,212,474 53,681,309 58,897,395 54,719,228 77,178,135 91,393,481 50,187, ,812,425 96,996,343 99,358,865 96,828, ,214, ,122,289 28

35 Table D1 C&LP Historical and Projected Annual kw Table D1 CL&P Historical and Projected kw Load Savings kw RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal Residential Retail Products 3,301 4,620 4,249 1,604 6,400 4,832 5,160 5,678 6,257 4,024 14,589 11,778 6,355 5,600 6,121 5,082 Appliance Retirement 1,042 1, Appliance Rebate Program Customer Initiated Projects Total - Consumer Products 3,301 4,620 4,249 1,604 7,464 6,306 5,603 5,678 6,492 4,024 14,589 11,778 6,355 5,600 6,121 5,082 Residential New Construction ,885 2, Home Energy Solutions (HVAC, Duct Sealing, Lighting) , ,188 2,856 3,151 2,520 3,261 2,220 5,054 2,521 2,626 2,852 1,666 1,722 HES Income Eligible ,110 1,067 1,271 1,172 1, ,045 1,039 Residential Behavior 7,144 10,696 Subtotal RESIDENTIAL 4,602 6,389 7,187 3,479 10,572 11,853 12,089 9,770 11,545 7,671 21,128 15,859 10,304 9,623 16,576 19,069 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 15,687 16,584 17,572 10,750 21,714 10,655 8,771 9,354 8,279 5,331 4,039 4,103 7,705 6,523 4,489 3,914 Total - Lost Opportunity 15,687 16,584 17,572 10,750 21,714 10,655 8,771 9,354 8,279 5,331 4,039 4,103 7,705 6,523 4,489 3,914 C&I LARGE RETROFIT C&I RFP 2,356 6,911 3, ,260 7,355 Energy Opportunities 1,267 1,450 2,204 1,286 1,426 2,431 15,295 17,675 14,859 6,017 8,693 8,761 10,669 7,843 11,163 10,933 Business & Energy Sustainability (O&M, RetroCx, BSC) 4,428 2, , ,276 2,276 PRIME - Municipal Energy & Schools 3,521 2,947 2,941 1, ,147 Total - C&I Large Retrofit 11,572 13,806 8,718 3,289 6,221 13,141 15,799 18,107 15,570 6,393 9,224 8,906 11,646 8,632 13,439 13,209 Small Business 849 2,285 2,352 2,430 3,354 2,349 8,497 9,310 8,287 4,987 5,244 4,759 3,692 2,943 4,600 4,776 Subtotal C&I 28,108 32,675 28,642 16,469 31,289 26,145 33,067 36,771 32,136 16,712 18,507 17,768 23,043 18,099 22,529 21,899 OTHER - LOAD MANAGEMENT ISO Load Response Program 45,951 29,900 60,755 23,576 16,467 17,294 13, ,432 92,474 91,403 95,642 95,000 95,000 Demand Reduction Power Factor ,401 4,133 4,412 1,047 Wait Until 8:00 Subtotal Load Management ,951 30,694 76,316 27,752 20,879 18,341 13, ,432 92,474 91,403 95,642 95,000 95,000 PROGRAM SUB-TOTALS Residential 4,602 6,389 7,187 3,479 10,572 11,853 12,089 9,770 11,545 7,671 21,128 15,859 10,304 9,623 16,576 19,069 C&I 28,108 32,675 28,642 62,420 61, ,461 60,819 57,650 50,477 30, , , , , , ,899 Other TOTAL (includes ISO Load Response) 32,710 39,064 35,829 65,899 72, ,314 72,908 67,420 62,022 37, , , , , , ,967 TOTAL (excludes ISO Load Response) 32,710 39,064 35,829 19,948 42,655 53,559 49,332 50,953 44,728 24,383 39,635 33,627 33,347 27,721 39,105 40,967 29

36 Table D2 CL&P Historical and Projected Annual kwh Table D2 CL&P Historical and Projected Annual kwh Annual Savings kwh (000's) RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal Residential Retail Products 38,308 54,016 41,603 12,365 70,088 59,864 64,556 71,908 65,971 42, , ,555 71,370 62,949 70,173 58,241 Appliance Retirement 4,577 7,653 3, Customer Initiated Projects Total - Consumer Products 38,308 54,016 41,603 12,365 74,949 67,993 67,753 71,908 66,109 42, , ,555 71,370 62,949 70,173 58,241 Residential New Construction 910 1,159 1,653 1, ,551 3,449 1,510 1, ,581 2,581 1,625 1,896 1,937 1,550 Home Energy Solutions (HVAC, Duct Sealing, Lighting) 7,474 7,233 5, ,343 1,862 5,324 7,868 9,367 6,595 22,724 16,190 15,494 16,559 13,439 13,986 HES Income Eligible 6,564 7,491 8,642 4,971 8,554 8,757 9,604 11,163 12,495 12,135 12,538 18,173 11,099 8,187 13,774 13,752 Residential Behavior 27,655 44,935 Subtotal RESIDENTIAL 53,256 69,899 57,251 18,964 85,393 81,163 86,130 92,449 89,507 61, , ,500 99,588 89, , ,465 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 65,506 75,507 72,372 41,942 80,147 60,129 47,925 44,217 49,940 23,225 21,451 21,890 33,973 38,741 22,982 22,548 Total - Lost Opportunity 65,506 75,507 72,372 41,942 80,147 60,129 47,925 44,217 49,940 23,225 21,451 21,890 33,973 38,741 22,982 22,548 C&I LARGE RETROFIT C&I RFP 13,465 40,444 18,394 3,447 20,606 45,530 Energy Opportunities 5,988 6,981 9,821 5,785 5,832 11,656 94, ,936 94,799 48,645 62,208 62,521 73,331 56,899 82,303 80,685 Business & Energy Sustainability (O&M, RetroCx, BSC) 25,807 15,436 3, ,553 9,124 4,301 3,388 9,265 3,117 3,872 2,888 11,137 4,325 22,882 23,464 PRIME 1,233 2,147 3,364 2,344 1,948 2,683 2,748 Municipal Energy & Schools 17,476 14,574 11,380 6,220 4,120 15,658 Total - C&I Large Retrofit 62,736 77,435 43,205 16,443 34,111 81,968 98, , ,064 52,995 68,227 68,773 86,812 63, , ,897 Small Business 4,166 11,639 11,798 13,109 19,269 13,428 32,492 37,334 37,254 23,250 30,392 29,681 28,943 26,801 40,863 44,331 Subtotal C&I 132, , ,375 71, , , , , ,258 99, , , , , , ,775 OTHER - LOAD MANAGEMENT ISO Load Response Program 670 Demand Reduction Power Factor Wait Until 8:00 Subtotal Load Management PROGRAM SUB-TOTALS Residential 53,256 69,899 57,251 18,964 85,393 81,163 86,130 92,449 89,507 61, , ,500 99,588 89, , ,465 C&I 132, , ,375 72, , , , , ,258 99, , , , , , ,775 Other - - TOTAL (includes ISO Load Response) 185, , ,626 91, , , , , , , , , , , , ,240 TOTAL (excludes ISO Load Response) 185, , ,626 90, , , , , , , , , , , , ,240 30

37 Table D3 CL&P Historical and Projected Lifetime kwh Table D3 CL&P Historical and Projected Lifetime kwh Lifetime Savings kwh (000's) RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal Residential Retail Products 575, , , , , , , , , , , , , , , ,044 Appliance Retirement 22,377 37,789 15, Customer Initiated Projects 4,713 8,040 Total - Consumer Products 575, , , , , , , , , , , , , , , ,044 Residential New Construction 22,226 24,147 60,409 21,782 9,114 34,399 43,764 19,431 19,910 12,656 25,469 43,198 28,472 31,175 33,500 30,469 Home Energy Solutions (HVAC, Duct Sealing, Lighting) 120, ,287 92,890 10,791 25,460 34,238 60,493 89, ,856 85, , , , , , ,107 HES Income Eligible 104, , ,198 84, , , , , , , , , , , , ,616 Residential Behavior 55,310 89,870 Subtotal RESIDENTIAL 822, , , , , , , , , ,778 1,124, , , , , ,106 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 1,121,918 1,339,508 1,235, ,610 1,344,801 1,023, , , , , , , , , , ,263 Total - Lost Opportunity 1,121,918 1,339,508 1,235, ,610 1,344,801 1,023, , , , , , , , , , ,263 C&I LARGE RETROFIT C&I RFP 227, , ,940 60, , ,018 Energy Opportunities 96, , ,330 96,507 99, ,284 1,664,677 1,466,673 1,227, , , , , , , ,740 Business & Energy Sustainability (O&M, RetroCx, BSC) 252, ,537 33,643 10,201 38, ,711 62,462 46,154 86,719 28,640 32,401 25,754 94,042 36, , ,029 PRIME 6,166 10,734 16,819 11,711 9,739 13,414 13,739 Municipal Energy & Schools 233, , ,864 98,804 69, ,524 Total - C&I Large Retrofit 809,590 1,132, , , ,148 1,338,537 1,727,139 1,512,827 1,314, , , , , ,720 1,132,392 1,117,508 Small Business 75, , , , , , , , , , , , , , , ,272 Subtotal C&I 2,007,132 2,660,560 2,071,690 1,228,545 2,243,914 2,595,279 3,101,242 2,686,188 2,536,648 1,279,730 1,518,795 1,492,037 1,831,690 1,640,549 1,989,348 2,011,043 OTHER - LOAD MANAGEMENT ISO Load Response Program 6,700 Demand Reduction 9,623 1, Power Factor Wait Until 8:00 Subtotal Load Management - - 6,700 9,623 1, PROGRAM SUB-TOTALS Residential 822, , , , , , , , , ,778 1,124, , , , , ,106 C&I 2,007,132 2,660,560 2,071,690 1,235,245 2,253,537 2,597,165 3,101,267 2,686,188 2,536,648 1,279,730 1,518,795 1,492,037 1,831,690 1,640,549 1,989,348 2,011,043 Other - - TOTAL (includes ISO Load Response) 2,829,325 3,656,620 2,892,643 1,490,831 3,104,374 3,272,669 3,821,941 3,420,234 3,322,432 1,729,508 2,643,108 2,397,877 2,536,323 2,355,406 2,971,273 2,910,148 TOTAL (excludes ISO Load Response) 2,829,325 3,656,620 2,892,643 1,484,131 3,104,374 3,272,669 3,821,941 3,420,234 3,322,432 1,729,508 2,643,108 2,397,877 2,536,323 2,355,406 2,971,273 2,910,148 31

38 Table D4 CL&P Historical and Projected Units Table D4 CL&P Historical and Projected Units Units 10,673 5, RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Budget Budget Residential Retail Products 279, , , ,417 1,795,372 1,444,142 1,980,791 2,409,313 2,368,034 1,606,793 4,046,226 3,384,219 2,322,287 2,176,584 3,156,706 2,902,002 Appliance Retirement 10,191 14,682 7, , , Appliance Rebate Program 26,000 13,156 26,134 20,514 17,597 11,003 1,536 - Customer Initiated Projects Total - Consumer Products 279, , , ,573 1,831,699 1,479,344 2,006,047 2,420,523 2,372,583 1,607,410 4,047,458 3,384,852 2,322,287 2,176,584 3,156,706 2,902,002 Residential New Construction , Home Energy Solution (HES) HES Furnace ,546 2,582 HES Heat Pump Water Heater 1,362 1, HES Insulation Rebate 99 1,058 1,034 1,180 1,840 HES Window Rebate ,231 HES Appliance Retirement 165 HESHVAC Home Energy Solutions (Duct Sealing, Lighting) 3,053 2,307 1, ,229 4,899 6,634 7,450 21,940 15,586 17,856 14,080 10,026 Residential HVAC 539 2,366 1,647 2,677 3,700 8,008 2,124 3,170 3,718 6,270 3,565 2,803 3,357 5,791 Energy Conservation Loan Program (ECLP) Total - Home Energy Solution (HES) 4,660 4,638 5,179 2,362 2,869 3,873 11,487 7,268 10,039 11,640 29,540 20,763 22,652 22,458 18,963 19,646 HES Income Eligible 6,749 6,736 6,022 3,683 8,765 9,818 10,481 11,244 8,521 10,282 10,797 14,609 8,424 7,824 13,655 13,539 Home Energy Reports 55 Residential Behavior 317, ,000 Subtotal RESIDENTIAL 290, , , ,356 1,844,051 1,494,027 2,029,304 2,439,725 2,391,781 1,629,869 4,088,399 3,420,930 2,354,233 2,207,636 3,507,159 3,253,149 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint Total - Lost Opportunity C&I LARGE RETROFIT C&I RFP Energy Opportunities 1,075 1, ,467 1,468 Business & Energy Sustainability (O&M, RetroCx, BSC) PRIME Municipal Energy & Schools Total - C&I Large Retrofit 1,314 1,317 1, , , ,763 1,820 Small Business ,397 1, ,546 1,504 1,519 1,277 2,341 2,641 Subtotal C&I 1,702 1,987 1,862 1,254 1,671 2,565 2,233 2,655 2,468 1,919 3,049 2,971 2,999 2,574 4,577 4,979 OTHER - LOAD MANAGEMENT ISO Load Response Program Demand Reduction Power Factor Wait Until 8:00 Subtotal Load Management PROGRAM SUB-TOTALS Residential 290, , , ,356 1,844,051 1,494,027 2,029,304 2,439,725 2,391,781 1,629,869 4,088,399 3,420,930 2,354,233 2,207,636 3,507,159 3,253,149 C&I 1,702 1,987 1,862 1,254 1,671 2,565 2,233 2,655 2,468 1,919 3,049 2,971 2,999 2,574 4,577 4,979 Other TOTAL (includes ISO Load Response) 292, , , ,652 1,845,773 1,496,618 2,031,546 2,442,390 2,394,250 1,631,826 4,091,864 3,424,212 2,357,495 2,210,435 3,511,956 3,258,348 TOTAL (excludes ISO Load Response) 292, , , ,610 1,845,723 1,496,618 2,031,546 2,442,390 2,394,250 1,631,788 4,091,448 3,423,901 2,357,232 2,210,210 3,511,736 3,258,128 32

39 Incentive $ Earned CL&P Performance Incentive 2014 THE CONNECTICUT LIGHT AND POWER COMPANY 2014 Management Incentive Performance Indicators and Incentive Matrix CL&P and the EEB recognize that having clear indicators and metrics of performance are helpful in delivering quality programs to Connecticut consumers. The following is a table of performance and incentive metrics developed by the utilities with input from the EEB, the Board consultants and the Department. These performance and incentive metrics apply to the programs delineated in this Plan. The projected CL&P Performance Incentive is $6,858,063 and is based on achieving 100% of all performance targets and earning an incentive of 5% of the total C&LM program budget of $137,161,270 as shown on Table A (exclusive of Energy Efficiency Board costs, Evaluation Consultant costs, management incentives and audit costs). The actual earned amount will be calculated on a sliding scale based on the percent of goal achieved and the actual total expenditures, based on the following performance range: Performance % Minimum -Performance Incentive Illustration- Pre-tax Incentive Pretax Incentive 12,000,000 Incentive $ Earned vs Performance Achieved % $3,429, % $4,114,838 10,000, % $5,486, % $6,858, % $8,229, % $9,601, % $10,972,902 8,000,000 6,000,000 4,000,000 Maximum Incentive Basis Budget $137,161,270 2,000,000 Goals will be prorated based on actual over/under spend of budget in the event actual spending is over/under 5% or more of budget Performance Achieved % of Target 33

40 CL&P Performance Incentive 2014 (cont.) SECTOR Program RESIDENTIAL Residential Programs (Sector Level) Sector Budget Net Electric System Benefit - Res. Home Energy Solutions $49,475 $15,303 Performance Indicators Incentive Metrics Incentive Metric Target Goal Weight Incentive Program Name LT-kWh kw % (1) Sum of Electric System Benefit from Residential programs Electric System Benefit from Residential programs $1,337,322 New Construction 33,500, % HES 168,893,321 1, % HES Income Eligible 180,982,441 1, % Residential Behavior / Engagement 55,309,500 7, % Total 981,924,327 16,576 Savings Rate $ / kwh $ / kw Savings $ 72,169 $ 8,642 (1) percent of target goal Electric System Benefit less Program Costs Electric Savings LTkWh : 168,893,321 Energy Savings Demand Savings kw : 1,666 included in appropriate sector Increase HES Savings (MMBTU) Per Home over 2013 baseline including code and standard impacts. Single Family (1-4 unit Dwellings) would be segmented for tracking to this metric. CL&P 2013 MMTBU Adjusted Baseline is 15.0 MMBTU Increase HES Savings (MMBTU) Per Home over 2013 baseline including code and standard impacts. Multi-Family (5+ unit Dwellings) would be segmented for tracking to this metric. CL&P 2013 MMTBU Adjusted Baseline is 6.7 MMBTU level metric Increase HES savings Per Home Increase HES savings Per Home Achieve 8% average increase in HES per participant savings across all fuels Achieve 8% average increase in HES per participant savings across all fuels HES- Percentage of Unique Single Family Homes that received core services for HES that get at least one add-on measure (i.e., insulation, Water Heaters, HVAC, Appliances). The CT Energy Efficiency Dashboard will be used for comparison for the period of January 1 to September (19% was achieved in 2013) % of homes with Add-Ons 24% or greater of the homes with add-on measures $137,161 Retail Products 543,239,046 6, % $80,811 $31,336 $31, $1,337, $137, $68,581 34

41 CL&P Performance Incentive 2014 (cont.) SECTOR Program RESIDENTIAL Residential New Construction HES Income Eligible Retail Products Performance Indicators Incentive Metrics Incentive Metric Target Goal Weight Incentive $1,646 Electric Savings LTkWh : 33,500,019 Energy Savings Demand Savings kw : 601 included in appropriate sector level metric Remodeling Initiative $17,202 Electric Savings LTkWh : 180,982,441 Energy savings Demand Savings kw : 1,045 included in appropriate sector level metric Expend the HES-IE Budget - Full Penalty is 5% times HES-IE Budgeted Spending. Expending 95% spending avoids the penalty. The penalty is on a sliding scale from 85% to 95%. Above 85% spending, the penalty is scaled with a 10% reduction in the penalty for each one percentage point increase in budget spend above 85%. Expend 2014 HES-IE Budget This is a penalty metric - 5% HES-IE - Annual MMBTU for electric, oil and propane measures CL&P- 86,354 Annual MMBTU savings $137,161 $12,325 Electric Savings LTkWh : 543,239,046 Energy savings Demand Savings kw : 6,121 included in appropriate sector level metric Retail Products -Number of LED Products (CL&P-335K LED product = 15% in 2013) Number of LED Products Number of LED Products (CL&P- 694K) $137,161 35

42 CL&P Performance Incentive 2014 (cont.) SECTOR Program COMMERCIAL & INDUSTRIAL (C&I) $66,369 C&I Programs (Sector Level) Sector Budget Net Electric System Benefit- C&I $32,031 Energy Opportunities $9,913 Energy Conscious Blueprint Performance Indicators Program Name LT-kWh kw % (1) Energy Conscious Blueprint 349,599,630 4, % Energy Opportunities 973,383,633 11, % PRIME 13,414, % Small Business 507,357,268 4, % Total 1,989,348,450 22,529 Savings Rate $ / kwh $ 1, / kw Savings $ 150,993 $ 26,143 (1) percent of target goal Electric System Benefit less Program Costs Number of projects that are comprehensive. Comprehensive is defined as: 1. More than 1 electric End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, or involve a natural gas measure End-Use and 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings Number of new construction /major renovation projects that are more efficient than the State Energy Code and are: 30% > than ASHRAE , or 20% > ASHRAE , or utilize Whole Building Performance, or Net Zero Energy Projects Net Zero Energy project shall include renewable energy technologies such as, but not limited to, Solar PV, Solar Thermal, Fuel Cells, CHP, and Wind Incentive Metrics Incentive Metric Target Goal Weight Incentive Total Electric System Benefit from C&I programs Electric System Benefit from C&I programs $1,440,193 20% of the signed projects $137,161 40% of signed projects $137,161 O&M 145,593,522 2, % $177,136 $110,767 $110, $1,440,193 36

43 CL&P Performance Incentive 2014 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive COMMERCIAL & INDUSTRIAL (C&I) Demand Saving kw : 4,600 included in appropriate sector level metric Small Business Number of projects that are comprehensive or implement measure bundles. Refer to the Energy Opportunities Comprehensive definition. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. 16% of the signed projects $137,161 For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Estar Natural Gas or Electric Dishwashers Manufacturing/ Segmentation Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the electric energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] 20% of savings via signed contracts are from the Manufacturing Sector Strategic Energy Management SEM signed Customer agreements may include, but not be limited to, BSC Agreements (*), Retro-Commissioning engineering study agreements, multi-year MOU s with Customers (which will outline a strategic plan for reducing consumption by a specific percentage each year along with tools and resources to be utilized such as metering, trending & reporting, Energy Star Benchmarking, Focused Study agreements, PRIME kaizen events, etc.), Clean Energy Community MOU s, packaged SEM and Customer Engagement tools and resources which already exist in the marketplace. (*) BSC = Business Sustainability Challenge 50 Customers $137,161 Total of Incentives $6,858,063 $18,900 Electric Saving LTkWh : 507,357,268 Energy savings $137,161 37

44 Incentive $ Earned CL&P Performance Incentive 2015 THE CONNECTICUT LIGHT AND POWER COMPANY 2015 Management Incentive Performance Indicators and Incentive Matrix CL&P and the EEB recognize that having clear indicators and metrics of performance are helpful in delivering quality programs to Connecticut consumers. The following is a table of performance and incentive metrics developed by the utilities with input from the EEB, the Board consultants and the Department. These performance and incentive metrics apply to the programs delineated in this Plan. The projected CL&P Performance Incentive is $6,882,264 and is based on achieving 100% of all performance targets and earning an incentive of 5% of the total C&LM program budget of $137,645,270 as shown on Table A (exclusive of Energy Efficiency Board costs, Evaluation Consultant costs, management incentives and audit costs). The actual earned amount will be calculated on a sliding scale based on the percent of goal achieved and the actual total expenditures, based on the following performance range: Performance % Minimum -Performance Incentive Illustration- Pre-tax Incentive Pretax Incentive 12,000,000 Incentive $ Earned vs Performance Achieved 80 3% $4,129,358 10,000, % $5,505, % $6,882, % $8,258, % $9,635, % $11,011,622 8,000,000 6,000,000 4,000,000 Maximum Incentive Basis Budget $137,645,270 2,000,000 Goals will be prorated based on actual over/under spend of budget in the event actual spending is over/under 5% or more of budget Performance Achieved % of Target 38

45 CL&P Performance Incentive 2015 (cont.) SECTOR Program RESIDENTIAL Residential Programs (Sector Level) Sector Budget Net Electric System Benefit - Res. Home Energy Solutions $50,314 $11,509 Performance Indicators Incentive Metrics Incentive Metric Target Goal Weight Incentive Program Name LT-kWh kw % (1) Sum of Electric System Benefit from Residential programs Electric System Benefit from Residential programs $1,342,041 New Construction 30,469, % HES 175,106,691 1, % HES Income Eligible 182,616,175 1, % Residential Behavior / Engagement 89,869,500 10, % Total 899,105,743 19,069 Savings Rate $ / kwh $ / kw Savings $ 67,471 $ 9,310 (1) percent of target goal Electric System Benefit less Program Costs Electric Savings LTkWh : 175,106,691 Energy Savings Demand Savings kw : 1,722 included in appropriate sector Increase HES Savings (MMBTU) Per Home over 2014 baseline including code and standard impacts. Single Family (1-4 unit Dwellings) would be segmented for tracking to this metric. CL&P 2013 MMTBU Adjusted Baseline is 15.0 MMBTU Increase HES Savings (MMBTU) Per Home over 2014 baseline including code and standard impacts. Multi-Family (5+ unit Dwellings) would be segmented for tracking to this metric. CL&P 2013 MMTBU Adjusted Baseline is 6.7 MMBTU level metric Increase HES savings Per Home Increase HES savings Per Home Achieve 8% average increase in HES per participant savings across all fuels Achieve 8% average increase in HES per participant savings across all fuels HES- Percentage of Unique Single Family Homes that received core services for HES that get at least one add-on measure (i.e., insulation, Water Heaters, HVAC, Appliances). The CT Energy Efficiency Dashboard will be used for comparison for the period of January 1 to September (19% was achieved in 2013) % of homes with Add- Ons 26% or greater of the homes with add-on measures $137,645 Retail Products 421,044,319 5, % $76,781 $26,466 $26, $1,342, $137, $68,823 39

46 CL&P Performance Incentive 2015 (cont.) SECTOR Program RESIDENTIAL Residential New Construction HES Income Eligible Retail Products Performance Indicators Incentive Metrics Incentive Metric Target Goal Weight Incentive Program Name LT-kWh kw % (1) $1,652 Electric Savings LTkWh : 30,469,058 Energy Savings Demand Savings kw : 530 included in appropriate sector level metric $17,245 Electric Savings LTkWh : 182,616,175 Energy savings Demand Savings kw : 1,039 included in appropriate sector level metric Expend the HES-IE Budget - Full Penalty is 5% times HES-IE Budgeted Spending. Expending 95% spending avoids the penalty. The penalty is on a sliding scale from 85% to 95%. Above 85% spending, the penalty is scaled with a 10% reduction in the penalty for each one percentage point increase in budget spend above 85%. Expend 2015 HES-IE Budget This is a penalty metric - 5% HES-IE - Annual MMBTU for electric, oil and propane measures Annual MMBTU CL&P- 86,405 Annual MMBTU savings $137,645 $12,540 Electric Savings LTkWh : 421,044,319 Energy savings Demand Savings kw : 5,082 included in appropriate Retail Products -Number of LED Products (CL&P-335K LED product = 15% in 2013) sector level metric Number of LED Products Number of LED Products (CL&P- 967K) $137,645 40

47 CL&P Performance Incentive 2015 (cont.) SECTOR Program COMMERCIAL & INDUSTRIAL (C&I) $66,286 C&I Programs (Sector Level) Sector Budget Net Electric System Benefit- C&I $31,835 Energy Opportunities $9,568 Energy Conscious Blueprint Performance Indicators Program Name LT-kWh kw % (1) Energy Conscious Blueprint 343,262,749 3, % Energy Opportunities 953,739,674 10, % PRIME 13,738, % Small Business 550,271,997 4, % Total 2,011,042,585 21,899 Savings Rate $ / kwh $ 1, / kw Savings $ 153,760 $ 27,813 (1) percent of target goal Electric System Benefit less Program Costs Number of projects that are comprehensive. Comprehensive is defined as: 1. More than 1 electric End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, or involve a natural gas measure End-Use and 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings Number of new construction /major renovation projects that are more efficient than the State Energy Code and are: 30% > than ASHRAE , or 20% > ASHRAE , or utilize Whole Building Performance, or Net Zero Energy Projects Net Zero Energy project shall include renewable energy technologies such as, but not limited to, Solar PV, Solar Thermal, Fuel Cells, CHP, and Wind Incentive Metrics Incentive Metric Target Goal Weight Incentive Total Electric System Benefit from C&I programs Electric System Benefit from C&I programs $1,445,275 25% of the signed projects $137,645 50% of signed projects $137,645 O&M 150,029,248 2, % $181,573 $115,287 $115, $1,445,275 41

48 CL&P Performance Incentive 2015 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive COMMERCIAL & INDUSTRIAL (C&I) Demand Saving kw : 4,776 included in appropriate sector level metric Small Business Number of projects that are comprehensive or implement measure bundles. Refer to the Energy Opportunities Comprehensive definition. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. 20% of the signed projects $137,645 For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Estar Natural Gas or Electric Dishwashers Manufacturing/ Segmentation Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the electric energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] 22% of savings via signed contracts are from the Manufacturing Sector $137,645 Strategic Energy Management SEM signed Customer agreements may include, but not be limited to, BSC Agreements (*), Retro-Commissioning engineering study agreements, multi-year MOU s with Customers (which will outline a strategic plan for reducing consumption by a specific percentage each year along with tools and resources to be utilized such as metering, trending & reporting, Energy Star Benchmarking, Focused Study agreements, PRIME kaizen events, etc.), Clean Energy Community MOU s, packaged SEM and Customer Engagement tools and resources which already exist in the marketplace. (*) BSC = Business Sustainability Challenge 100 Customers $137,645 Total of Incentives $6,882,264 $19,358 Electric Saving LTkWh : 550,271,997 Energy savings 42

49 The United Illuminating Company Budget Tables 43

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51 Table A UI 2013 Actual Results, Budget Table A UI 2014 & 2015 Proposed C&LM Budget UI C&LM BUDGET RESIDENTIAL UI UI PROPOSED UI PROPOSED ACTUAL BUDGET BUDGET EXPENDITURES Residential Retail Products 2,083,540 2,975,296 3,259,609 Total - Consumer Products $ 2,083,540 $ 2,975,296 $ 3,259,609 Residential New Construction $ 171,740 $ 154,242 $ 147,784 Home Energy Solutions (HES) $ 2,958,489 $ 2,515,354 $ 2,657,484 HES Potential Allocation (NOTE 1) $ 540,000 $ 929,519 HES Income Eligible $ 4,775,856 $ 3,253,718 $ 3,293,820 Residential Behavior $ 300,000 $ 300,000 Subtotal RESIDENTIAL $ 9,989,625 $ 9,738,610 $ 10,588,216 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint $ 2,102,818 $ 3,777,000 $ 3,777,000 Total - Lost Opportunity $ 2,102,818 $ 3,777,000 $ 3,777,000 C&I LARGE RETROFIT Energy Opportunities $ 4,123,796 $ 5,853,457 $ 5,853,457 O&M (Services, RetroCx, BSC) $ 296,969 $ 1,624,977 $ 1,624,977 PRIME $ 61,412 $ 150,000 $ 150,000 Total - C&I Large Retrofit $ 4,482,177 $ 7,628,434 $ 7,628,434 Small Business $ 2,403,882 $ 3,825,935 $ 3,825,935 Subtotal C&I $ 8,988,877 $ 15,231,369 $ 15,231,369 OTHER - EDUCATION SmartLiving Center $ 602,018 $ 988,741 $ 413,514 Clean Energy Communities $ 240,937 $ 355,960 $ 355,960 K - 12 Education $ 343,131 $ 320,874 $ 320,874 Customer Engagement $ 120,000 $ 120,000 Subtotal Education $ 1,186,086 $ 1,785,575 $ 1,210,348 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy (ECSU) $ 112,000 $ 89,600 $ 89,600 Residential Loan Program (Includes ECLF) (NOTE 1) $ 158,257 $ 688,211 $ 382,560 C&I Loan Program $ 9,345 $ 693,123 $ 693,123 C&LM Loan Defaults $ 32,339 $ 35,000 $ 31,111 C&I Self-Funding $ 1,000,000 $ 1,000,000 Subtotal Programs/Requirements $ 311,941 $ 2,505,934 $ 2,196,394 OTHER - RENEWABLES & RD&D Research, Development & Demonstration $ 289,840 $ 152,206 $ 132,692 Subtotal Renewables & RD&D $ 289,840 $ 152,206 $ 132,692 OTHER - ADMINISTRATIVE & PLANNING Administration $ 901,370 $ 540,241 $ 540,241 ESPCP Program Manager $ 2,615 $ 19,200 $ 19,200 Planning $ 342,831 $ 256,830 $ 256,830 Evaluation Studies $ 735,767 $ 578,922 $ 621,721 Evaluation Consultant $ 58,311 $ 58,311 Information Technology $ 248,705 $ 261,888 $ 261,888 EEB $ 232,128 $ 241,009 $ 241, Performance Management Fee $ 54,458 $ - $ Performance Management Fee $ 1,463,968 $ - $ Performance Management Fee $ - $ 1,594,205 $ Performance Management Fee $ - $ - $ 1,593,612 Marketing Plan $ 35,187 $ 813,333 $ 813,333 Admin/Planning Expenditures $ 4,017,029 $ 4,363,939 $ 4,406,145 PROGRAM SUB-TOTALS Residential $ 11,193,527 $ 12,570,122 $ 12,653,896 C&I $ 9,206,189 $ 17,415,099 $ 17,296,164 Other* $ 4,383,682 $ 3,792,412 $ 3,815,104 TOTAL C&LM BUDGET $ 24,783,398 $ 33,777,633 $ 33,765,164 NOTE 1: UI allocated $200K from HES Potential Allocation to Residential Financing for self-funding. DEEP allowed $500K allocation, but Residential Financing budget already includes $300K for self-funding. * OTHER -EDUCATION is primarily allocated to residential programs. 45

52 Table A 2014 Pie 2014 CONSERVATION & LOAD MANAGEMENT BUDGET PIES TABLE A C&LM Budget By Customer Class C&LM Revenue By Customer Class Med & Large Industrial 10.20% Municipal 3.17% Res. Low Income 13.30% Med & Large Industrial 9.29% Municipal 4.30% Res. Low Income 12.90% 145,424 1,454,241 Med & Large Commercial 31.95% Res Non-Low Income 28.63% Med & Large Commercial 25.14% Res Non-Low Income 27.84% Small Business <200kW 13.71% Small Business <200W 20.53% Customer Class Budget % of Total C&LM Budget % of Residential & C&I Budget % of Residential & C&I Revenue Difference Res. Low Income $ 3,986, % 13.30% 12.90% 0.40% Res Non-Low Income $ 8,583, % 28.63% 27.84% 0.79% Residential Sub-total $ 12,570, % 41.92% 40.74% 1.18% Small Business <200kW $ 3,825, % 12.76% 20.53% -7.77% Med & Large Commercial $ 9,580, % 31.95% 25.14% 6.81% Med & Large Industrial $ 3,058, % 10.20% 9.29% 0.91% Municipal $ 950, % 3.17% 4.30% -1.13% C & I Sub-total $ 17,415, % 58.08% 59.26% -1.18% Sub-total for Residential and C&I $ 29,985, % % % 0.00% Other Expenditures $ 3,792, % Other Expenditures Sub-total $ 3,792, % GRAND TOTAL * $ 33,777, % 46

53 Table A 2015 Pie THE UNITED ILLUMINATING COMPANY 2015 CONSERVATION & LOAD MANAGEMENT BUDGET PIES TABLE A C&LM Budget By Customer Class C&LM Revenue By Customer Class Med & Large Industrial 10.02% Municipal 3.17% Res. Low Income 12.98% Med & Large Industrial 9.29% Municipal 4.30% Res. Low Income 12.90% 145,424 1,454,241 Med & Large Commercial 31.78% Res Non-Low Income 29.27% Med & Large Commercial 25.14% Res Non-Low Income 27.84% Small Business <200kW 13.95% Small Business <200kW 20.53% Customer Class Budget % of Total C&LM Budget % of Residential & C&I Budget % of Residential & C&I Revenue Difference Res. Low Income $ 3,888, % 12.98% 12.90% 0.08% Res Non-Low Income $ 8,765, % 29.27% 27.84% 1.43% Residential Sub-total $ 12,653, % 42.25% 40.74% 1.51% Small Business <200kW $ 3,825, % 12.77% 20.53% -7.76% Med & Large Commercial $ 9,519, % 31.78% 25.14% 6.64% Med & Large Industrial $ 3,000, % 10.02% 9.29% 0.73% Municipal $ 950, % 3.17% 4.30% -1.13% C & I Sub-total $ 17,296, % 57.75% 59.26% -1.51% Sub-total for Residential and C&I $ 29,950, % % % 0.00% Other Expenditures $ 3,815, % Other Expenditures Sub-total $ 3,815, % GRAND TOTAL * $ 33,765, % 47

54 Table B 2014 UI Comparison of Conservation Programs THE UNITED ILLUMINATING COMPANY 2014 CONSERVATION & LOAD MANAGEMENT COMPARISON OF UI CONSERVATION PROGRAMS INCLUDES DRIPE AND CO 2 TABLE B Program Program Costs 2014 ** Utility Costs 2014 ** Customer Cost 2014 Total Resource Cost 2014 Program Benefit 2014 (Electric, Oil & Propane) Total Resource Benefit 2014 Program B/C Ratio Residential Retail Products $ 2,975,296 $ 2,975,296 $ 2,436,802 $ 5,412,098 $ 11,699,520 $ 20,192, ,848 Total Resource B/C Ratio Goals/# Units Units of Measure Annualized Savings kwh Lifetime Savings kwh Load Savings kw Bulbs, Fixtures 17,107, ,638,950 1,517.7 TOTAL - CONSUMER PRODUCTS $ 2,975,296 $ 2,975,296 $ 2,436,802 $ 5,412,098 $ 11,699,520 $ 20,192, ,107, ,638,950 1,517.7 Residential New Construction $ 154,242 $ 154,242 $ 389,735 $ 543,977 $ 428,570 $ 522, No. of Units 180,216 2,417, * Home Energy Solutions $ 3,055,354 $ 2,132,401 $ 1,342,401 $ 4,397,755 $ 11,098,056 $ 13,020, ,766 No. of Ptcps. 3,255,281 34,577, HES Income Eligible $ 3,253,718 $ 2,473,553 $ 590,432 $ 3,844,150 $ 8,281,995 $ 9,975, ,532 Customers 3,557,413 33,364, Residential Behavior $ 300,000 $ 300,000 $ 178,920 $ 478,920 $ 938,348 $ 1,277, ,500 Customers 817,500 8,175, SUB-TOTAL RESIDENTIAL $ 9,738,610 $ 8,035,492 $ 4,938,289 $ 14,676,899 $ 32,446,489 $ 44,988, ,917, ,173,266 2,637.7 Energy Conscious Blueprint (a) $ 3,777,000 $ 3,777,000 $ 4,239,467 $ 8,016,467 $ 14,195,416 $ 19,276, Projects 9,255, ,587,135 1,486.0 TOTAL - LOST OPPORTUNITY $ 3,777,000 $ 3,777,000 $ 4,239,467 $ 8,016,467 $ 14,195,416 $ 19,276, ,255, ,587,135 1,486.0 Energy Opportunities $ 5,853,457 $ 5,853,457 $ 7,223,866 $ 13,077,323 $ 17,508,888 $ 23,967, Projects 15,120, ,350,285 2,042.8 O&M Services (BSC, Training, RetroX) $ 1,624,977 $ 1,624,977 $ 1,342,762 $ 2,967,739 $ 5,651,163 $ 8,459, Projects 8,720,289 65,671,318 1,062.9 PRIME $ 150,000 $ 150,000 $ - $ 150,000 $ 242,695 $ 382, Projects 600,000 3,000,000 - TOTAL - C&I LARGE RETROFIT $ 7,628,434 $ 7,628,434 $ 8,566,628 $ 16,195,062 $ 23,402,746 $ 32,809, ,440, ,021,603 3,105.7 Small Business $ 3,825,935 $ 3,825,935 $ 4,601,930 $ 8,427,865 $ 10,190,983 $ 13,918, Projects 7,956, ,700,141 1,228.2 SUB-TOTAL C&I $ 15,231,369 $ 15,231,369 $ 17,408,026 $ 32,639,395 $ 47,789,146 $ 66,003, Projects 41,653, ,308,879 5,819.8 SmartLiving Center $ 988,741 $ 988,741 15,000 Customers Clean Energy Communities $ 355,960 $ 355,960 Science Center $ - $ - K-12 Education $ 320,874 $ 320,874 2,000 Curriculum Customer Engagement $ 120,000 $ 120,000 SUB-TOTAL EDUCATION $ 1,785,575 $ 1,785,575 Institute for Sustainable Energy (ECSU) $ 89,600 $ 89,600 Residential Loan Program (Includes ECLF) $ 688,211 $ 688,211 C&I Financing $ 693,123 $ 693,123 C&LM Loan Defaults $ 35,000 $ 35,000 C&I Self-Funding $ 1,000,000 $ 1,000,000 SUB-TOTAL PROGRAMS/REQUIREMENTS $ 2,505,934 $ 2,505,934 Research, Development & Demonstration $ 152,206 $ 152,206 SUB-TOTAL RENEWABLES AND RD&D $ 152,206 $ 152,206 Administration $ 540,241 $ 540,241 ESPCP Program Manager $ 19,200 $ 19,200 Planning $ 256,830 $ 256,830 Evaluation Studies $ 578,922 $ 578,922 Evaluation Consultant $ 58,311 $ 58,311 Information Technology $ 261,888 $ 261,888 EEB $ 241,009 $ 241, Performance Management Fee $ 1,594,205 $ 1,594,205 Marketing Plan $ 813,333 $ 813,333 SUB-TOTAL ADMIN & PLANNING $ 4,363,939 $ 4,363,939 PROGRAM SUB-TOTALS RESIDENTIAL $ 12,570,122 $ 10,867,004 $ 4,938,289 $ 14,676,899 $ 32,446,489 $ 44,988, ,917, ,173,266 2,637.7 COMMERCIAL & INDUSTRIAL $ 17,415,099 $ 17,415,099 $ 17,408,026 $ 32,639,395 $ 47,789,146 $ 66,003, ,653, ,308,879 5,819.8 OTHER *** $ 3,792,412 $ 3,792,412 $ - $ - $ - $ - - TOTAL C&LM BUDGET Note 2 $ 33,777,633 $ 32,074,515 $ 22,346,315 $ 47,316,294 $ 80,235,635 $ 110,991, ,570, ,482,145 8,457.5 Notes: (a) Energy Blueprint includes Motors and Cool Choice * HES values include contingent planning funding ** HES and HES-IE utility costs do not include Oil and Propane incentive expenditures *** Other - Education is primarily allocated to Residential Programs 48

55 Table B 2014 UI Comparison of Conservation Programs (cont.) THE UNITED ILLUMINATING COMPANY 2014 CONSERVATION & LOAD MANAGEMENT COMPARISON OF UI CONSERVATION PROGRAMS INCLUDES DRIPE AND CO 2 TABLE B Program Demand Cost $/kw Demand Cost $/kw yr Utility Cost Rate $/kwh Annualized Utility Cost Rate $/kwh Lifetime Annualized Savings Oil (Gallons) Lifetime Savings Oil (Gallons) Annualized Savings Propane (Gallons) Lifetime Savings Propane (Gallons) Annualized MMBTU (Electric, Oil, Propane) Lifetime MMBTU (Electric, Oil, Propane) Cost per Annual MMBTU Cost per Lifetime MMBTU Residential Retail Products $ 1,960 $ 253 $ $ , ,697 $ 51.0 $ 6.57 TOTAL - CONSUMER PRODUCTS $ 1,960 $ 253 $ $ , ,697 $ 51.0 $ Residential New Construction $ 2,525 $ 188 $ $ , ,169 $ $ * Home Energy Solutions $ 3,866 $ 364 $ $ ,697 1,979,270 6, ,657 27, ,262 $ $ 7.58 HES Income Eligible $ 9,022 $ 962 $ $ ,398 1,479,174 2,545 50,787 23, ,659 $ $ Residential Behavior $ 1,287 $ 129 $ $ ,790 27,901 $ $ SUB-TOTAL RESIDENTIAL $ 3,046 $ 359 $ $ ,095 3,458,444 9, , ,403 1,217,688 $ 85.9 $ 8.00 Energy Conscious Blueprint (a) $ 2,542 $ 171 $ $ , ,585 $ $ 8.04 TOTAL - LOST OPPORTUNITY $ 2,542 $ 171 $ $ , ,585 $ $ 8.04 Energy Opportunities $ 2,865 $ 248 $ $ , ,058 $ $ 9.84 O&M Services (BSC, Training, RetroX) $ 1,529 $ 203 $ $ , ,136 $ 54.6 $ 7.25 PRIME $ - $ - $ $ ,048 10,239 $ 73.2 $ TOTAL - C&I LARGE RETROFIT $ 2,456 $ 247 $ $ , ,433 $ 91.5 $ 9.20 Small Business $ 3,115 $ 244 $ $ , ,103 $ $ SUB-TOTAL C&I $ 2,617 $ 226 $ $ ,162 1,646,120 $ $ 9.25 SmartLiving Center Clean Energy Communities Science Center K-12 Education Customer Engagement SUB-TOTAL EDUCATION Institute for Sustainable Energy (ECSU) Residential Loan Program (Includes ECLF) C&I Financing C&LM Loan Defaults C&I Self-Funding SUB-TOTAL PROGRAMS/REQUIREMENTS Research, Development & Demonstration SUB-TOTAL RENEWABLES AND RD&D Administration ESPCP Program Manager Planning Evaluation Studies Evaluation Consultant Information Technology EEB 2014 Performance Management Fee Marketing Plan SUB-TOTAL ADMIN & PLANNING PROGRAM SUB-TOTALS RESIDENTIAL $ 4,120 $ 486 $ $ ,095 3,458,444 9, , ,403 1,217,688 $ $ COMMERCIAL & INDUSTRIAL $ 2,992 $ 258 $ $ ,162 1,646,120 $ $ OTHER *** TOTAL C&LM BUDGET Note 2 $ 3,792 $ 364 $ $ ,095 3,458,444 9, , ,565 2,863,808 $ $ Notes: (a) Energy Blueprint includes Motors and Cool * HES values include contingent planning funding ** HES and HES-IE utility costs do not include Oil and Propane incentive expenditures *** Other - Education is primarily allocated to Residential Programs 49

56 Table B 2015 UI Comparison of Conservation Programs THE UNITED ILLUMINATING COMPANY 2015 CONSERVATION & LOAD MANAGEMENT COMPARISON OF UI CONSERVATION PROGRAMS INCLUDES DRIPE AND CO 2 TABLE B Program Program Costs 2015 ** Utility Costs 2015 ** Customer Cost 2015 Total Resource Cost 2015 Program Benefit 2015 (Electric, Oil & Propane) Total Resource Benefit 2015 Program B/C Ratio Residential Retail Products $ 3,259,609 $ 3,259,609 $ 2,145,181 $ 5,404,790 $ 9,938,500 $ 17,731, ,801 Total Resource B/C Ratio Goals/# Units Units of Measure Annualized Savings kwh Lifetime Savings kwh Load Savings kw Bulbs, Fixtures 13,879, ,050,853 1,215.5 TOTAL - CONSUMER PRODUCTS $ 3,259,609 $ 3,259,609 $ 2,145,181 $ 5,404,790 $ 9,938,500 $ 17,731, ,879, ,050,853 1,215.5 Residential New Construction $ 147,784 $ 147,784 $ 370,451 $ 518,235 $ 351,999 $ 483, No. of Units 164,357 2,216, * Home Energy Solutions $ 3,587,003 $ 2,465,428 $ 1,505,529 $ 5,092,532 $ 13,161,736 $ 15,409, ,530 No. of Ptcps. 3,656,584 38,911, HES Income Eligible $ 3,293,820 $ 2,502,913 $ 590,432 $ 3,884,252 $ 8,374,433 $ 10,082, ,636 Customers 3,532,989 33,560, Residential Behavior $ 300,000 $ 300,000 $ 178,920 $ 478,920 $ 938,348 $ 938, ,500 Customers 817,500 8,175, SUB-TOTAL RESIDENTIAL $ 10,588,216 $ 8,675,733 $ 4,790,513 $ 15,378,729 $ 32,765,017 $ 44,645, ,051, ,914,097 2,402.7 Energy Conscious Blueprint (a) $ 3,777,000 $ 3,777,000 $ 4,232,379 $ 8,009,379 $ 14,763,800 $ 19,781, Projects 9,211, ,368,960 1,475.7 TOTAL - LOST OPPORTUNITY $ 3,777,000 $ 3,777,000 $ 4,232,379 $ 8,009,379 $ 14,763,800 $ 19,781, ,211, ,368,960 1,475.7 Energy Opportunities $ 5,853,457 $ 5,853,457 $ 7,363,839 $ 13,217,296 $ 16,918,310 $ 22,967, Projects 14,911, ,407,557 1,904.8 O&M Services (BSC, Training, RetroX) $ 1,624,977 $ 1,624,977 $ 1,342,762 $ 2,967,739 $ 6,076,418 $ 8,834, Projects 8,525,697 64,698,357 1,062.9 PRIME $ 150,000 $ 150,000 $ - $ 150,000 $ 242,687 $ 383, Projects 600,000 3,000,000 - TOTAL - C&I LARGE RETROFIT $ 7,628,434 $ 7,628,434 $ 8,706,601 $ 16,335,035 $ 23,237,415 $ 32,184, ,036, ,105,914 2,967.7 Small Business $ 3,825,935 $ 3,825,935 $ 4,618,269 $ 8,444,204 $ 10,637,365 $ 14,343, Projects 7,970, ,903,445 1,231.9 SUB-TOTAL C&I $ 15,231,369 $ 15,231,369 $ 17,557,249 $ 32,788,618 $ 48,638,579 $ 66,309, Projects 41,219, ,378,319 5,675.2 SmartLiving Center $ 413,514 $ 413,514 15,000 Customers Clean Energy Communities $ 355,960 $ 355,960 Science Center $ - $ - K-12 Education $ 320,874 $ 320,874 2,000 Curriculum Customer Engagement $ 120,000 $ 120,000 SUB-TOTAL EDUCATION $ 1,210,348 $ 1,210,348 Institute for Sustainable Energy (ECSU) $ 89,600 $ 89,600 Residential Loan Program (Includes ECLF) $ 382,560 $ 382,560 C&I Financing $ 693,123 $ 693,123 C&LM Loan Defaults $ 31,111 $ 31,111 C&I Self-Funding $ 1,000,000 $ 1,000,000 SUB-TOTAL PROGRAMS/REQUIREMENTS $ 2,578,954 $ 2,578,954 Research, Development & Demonstration $ 132,692 $ 132,692 SUB-TOTAL RENEWABLES AND RD&D $ 132,692 $ 132,692 Administration $ 540,241 $ 540,241 ESPCP Program Manager $ 19,200 $ 19,200 Planning $ 256,830 $ 256,830 Evaluation Studies $ 621,721 $ 621,721 Evaluation Consultant $ 58,311 $ 58,311 Information Technology $ 261,888 $ 261,888 EEB $ 241,009 $ 241, Performance Management Fee $ 1,593,612 $ 1,593,612 Marketing Plan $ 813,333 $ 813,333 SUB-TOTAL ADMIN & PLANNING $ 4,406,145 $ 4,406,145 PROGRAM SUB-TOTALS RESIDENTIAL $ 12,653,896 $ 10,741,413 $ 4,790,513 $ 15,378,729 $ 32,765,017 $ 44,645, ,051, ,914,097 2,402.7 COMMERCIAL & INDUSTRIAL $ 17,296,164 $ 17,296,164 $ 17,557,249 $ 32,788,618 $ 48,638,579 $ 66,309, ,219, ,378,319 5,675.2 OTHER ** $ 3,815,104 $ 3,815,104 $ - $ - $ - $ - - TOTAL C&LM BUDGET Note 2 $ 33,765,164 $ 31,852,681 $ 22,347,761 $ 48,167,346 $ 81,403,596 $ 110,954, ,270, ,292,416 8,078.0 Notes: $ 162,025,143 (a) Energy Blueprint includes Motors and Cool Choice * HES values include contingent planning funding * Other - Education is primarily allocated to Residential Programs 50

57 Table B 2015 UI Comparison of Conservation Programs (cont.) THE UNITED ILLUMINATING COMPANY 2015 CONSERVATION & LOAD MANAGEMENT COMPARISON OF UI CONSERVATION PROGRAMS INCLUDES DRIPE AND CO 2 TABLE B Program Demand Cost $/kw Demand Cost $/kw yr Utility Cost Rate $/kwh Annualized Utility Cost Rate $/kwh Lifetime Annualized Savings Oil (Gallons) Lifetime Savings Oil (Gallons) Annualized Savings Propane (Gallons) Lifetime Savings Propane (Gallons) Annualized MMBTU (Electric, Oil, Propane) Lifetime MMBTU (Electric, Oil, Propane) Cost per Annual MMBTU Cost per Lifetime MMBTU Residential Retail Products $ 2,682 $ 329 $ $ , ,843 $ 68.8 $ 8.45 TOTAL - CONSUMER PRODUCTS $ 2,682 $ 329 $ $ , ,843 $ 68.8 $ 8.45 Residential New Construction $ 2,555 $ 189 $ $ , ,373 $ $ * Home Energy Solutions $ 3,957 $ 372 $ $ ,595 2,405,215 7, ,977 32, ,442 $ $ 7.48 HES Income Eligible $ 9,164 $ 965 $ $ ,532 1,498,238 2,561 51,137 23, ,002 $ $ Residential Behavior $ 1,287 $ 129 $ $ ,790 27,901 $ $ SUB-TOTAL RESIDENTIAL $ 3,611 $ 406 $ $ ,127 3,903,453 11, , ,351 1,229,560 $ 98.6 $ 8.61 Energy Conscious Blueprint (a) $ 2,560 $ 172 $ $ , ,840 $ $ 8.06 TOTAL - LOST OPPORTUNITY $ 2,560 $ 172 $ $ , ,840 $ $ 8.06 Energy Opportunities $ 3,073 $ 282 $ $ , ,297 $ $ O&M Services (BSC, Training, RetroX) $ 1,529 $ 201 $ $ , ,815 $ 55.8 $ 7.36 PRIME $ - $ - $ $ ,048 10,239 $ 73.2 $ TOTAL - C&I LARGE RETROFIT $ 2,570 $ 269 $ $ , ,351 $ 93.0 $ 9.71 Small Business $ 3,106 $ 243 $ $ , ,796 $ $ SUB-TOTAL C&I $ 2,684 $ 236 $ $ ,681 1,601,988 $ $ 9.51 SmartLiving Center Clean Energy Communities Science Center K-12 Education Customer Engagement SUB-TOTAL EDUCATION Institute for Sustainable Energy (ECSU) Residential Loan Program (Includes ECLF) C&I Financing C&LM Loan Defaults C&I Self-Funding SUB-TOTAL PROGRAMS/REQUIREMENTS Research, Development & Demonstration SUB-TOTAL RENEWABLES AND RD&D Administration ESPCP Program Manager Planning Evaluation Studies Evaluation Consultant Information Technology EEB 2015 Performance Management Fee Marketing Plan SUB-TOTAL ADMIN & PLANNING PROGRAM SUB-TOTALS RESIDENTIAL $ 4,470 $ 503 $ $ ,127 3,903,453 11, , ,351 1,229,560 $ $ COMMERCIAL & INDUSTRIAL $ 3,048 $ 268 $ $ ,681 1,601,988 $ $ OTHER ** TOTAL C&LM BUDGET Note 2 $ 3,943 $ 375 $ $ ,127 3,903,453 11, , ,032 2,831,548 $ $ Notes: (a) Energy Blueprint includes Motors and Cool * HES values include contingent planning funding * Other - Education is primarily allocated to Residential Programs 51

58 Table C 2014 UI Budget THE UNITED ILLUMINATING COMPANY 2014 CONSERVATION & LOAD MANAGEMENT TABLE C PROGRAM NAME UI Labor Materials & Supplies Outside Services Contractor Labor Incentives Marketing Other (b) Administrative Expenses TOTAL Residential Retail Products $ 140,486 $ 5,000 $ 230,000 $ - $ 2,348,810 $ 240,000 $ 6,000 $ 5,000 $ 2,975,296 TOTAL - CONSUMER PRODUCTS $ 140,486 $ 5,000 $ 230,000 $ - $ 2,348,810 $ 240,000 $ 6,000 $ 5,000 $ 2,975,296 Residential New Construction $ 24,742 $ 1,500 $ 5,000 $ - $ 102,500 $ 15,000 $ 3,000 $ 2,500 $ 154,242 Home Energy Solutions $ 245,392 $ 15,000 $ 240,000 $ - $ 2,400,962 $ 120,000 $ 15,000 $ 19,000 $ 3,055,354 HES Income Eligible $ 306,517 $ 20,000 $ 100,000 $ - $ 2,759,701 $ 55,000 $ 4,000 $ 8,500 $ 3,253,718 Residential Behavior $ 10,050 $ 3,750 $ 204,450 $ - $ - $ 75,000 $ 3,750 $ 3,000 $ 300,000 SUB-TOTAL RESIDENTIAL $ 727,187 $ 45,250 $ 779,450 $ - $ 7,611,973 $ 505,000 $ 31,750 $ 38,000 $ 9,738,610 Energy Conscious Blueprint (a) $ 502,305 $ 3,500 $ 275,000 $ 50,000 $ 2,834,195 $ 42,000 $ 10,000 $ 60,000 $ 3,777,000 TOTAL - LOST OPPORTUNITY $ 502,305 $ 3,500 $ 275,000 $ 50,000 $ 2,834,195 $ 42,000 $ 10,000 $ 60,000 $ 3,777,000 Energy Opportunities $ 536,259 $ 6,000 $ 200,000 $ 70,000 $ 4,565,698 $ 86,000 $ 5,000 $ 384,500 $ 5,853,457 O&M Services (RFP, BSC, Training, RetroX, PRIME) $ 153,120 $ 1,600 $ 584,390 $ - $ 988,867 $ 24,000 $ 5,000 $ 18,000 $ 1,774,977 TOTAL - C&I LARGE RETROFIT $ 689,379 $ 7,600 $ 784,390 $ 70,000 $ 5,554,565 $ 110,000 $ 10,000 $ 402,500 $ 7,628,434 Small Business $ 351,946 $ 2,000 $ 150,000 $ 28,000 $ 2,664,291 $ 42,000 $ 2,500 $ 585,198 $ 3,825,935 SmartLiving Center $ 45,470 $ 10,000 $ 640,271 $ 88,000 $ - $ 25,000 $ 178,000 $ 2,000 $ 988,741 Clean Energy Communities $ 49,206 $ 5,000 $ 202,754 $ - $ - $ 79,000 $ 5,000 $ 15,000 $ 355,960 K-12 Education $ 41,449 $ 6,000 $ 197,925 $ - $ 30,000 $ 38,000 $ 2,500 $ 5,000 $ 320,874 Customer Engagement $ - $ - $ 120,000 $ - $ - $ - $ - $ - $ 120,000 SUB-TOTAL EDUCATION $ 136,125 $ 21,000 $ 1,160,950 $ 88,000 $ 30,000 $ 142,000 $ 185,500 $ 22,000 $ 1,785,575 Institute for Sustainable Energy (ECSU) $ - $ - $ - $ - $ - $ - $ 89,600 $ - $ 89,600 Residential Loan Program (Includes ECLF) $ 30,451 $ - $ - $ - $ - $ - $ 657,760 $ - $ 688,211 C&I Loan Program $ - $ - $ - $ - $ - $ - $ 693,123 $ - $ 693,123 C&LM Loan Defaults $ - $ - $ - $ - $ - $ - $ 35,000 $ - $ 35,000 C&I Self Funding $ - $ - $ - $ - $ - $ - $ 1,000,000 $ - $ 1,000,000 SUB-TOTAL PROGRAMS/REQUIREMENTS $ 30,451 $ - $ - $ - $ - $ - $ 2,475,483 $ - $ 2,505,934 Research, Development & Demonstration $ - $ - $ 152,206 $ - $ - $ - $ - $ - $ 152,206 SUB-TOTAL RENEWABLES AND RD&D $ - $ - $ 152,206 $ - $ - $ - $ - $ - $ 152,206 Administration $ 439,918 $ 20,000 $ 75,324 $ - $ - $ - $ - $ 5,000 $ 540,242 ESPCP Program Manager $ - $ - $ 19,200 $ - $ - $ - $ - $ - $ 19,200 Planning $ 251,830 $ - $ - $ - $ - $ - $ - $ 5,000 $ 256,830 Evaluation Studies $ 79,119 $ - $ 499,803 $ - $ - $ - $ - $ - $ 578,922 Evaluation Consultant $ - $ - $ 58,311 $ - $ - $ - $ - $ - $ 58,311 Information Technology $ 26,643 $ 153,000 $ 79,645 $ - $ - $ - $ - $ 2,600 $ 261,888 EEB $ - $ - $ 241,009 $ - $ - $ - $ - $ - $ 241,009 Marketing Plan $ - $ - $ - $ - $ - $ 813,333 $ - $ - $ 813, Performance Management Fee $ - $ - $ - $ - $ - $ - $ 1,594,205 $ - $ 1,594,205 SUB-TOTAL ADMIN & PLANNING $ 797,510 $ 173,000 $ 973,292 $ - $ - $ 813,333 $ 1,594,205 $ 12,600 $ 4,363,940 PROGRAM SUB-TOTALS RESIDENTIAL $ 874,828 $ 63,250 $ 1,747,795 $ 70,400 $ 7,641,973 $ 1,276,866 $ 838,410 $ 56,600 $ 12,570,122 COMMERCIAL & INDUSTRIAL $ 1,562,565 $ 16,100 $ 1,401,995 $ 165,600 $ 11,053,051 $ 377,467 $ 1,787,223 $ 1,051,098 $ 17,415,099 OTHER $ 797,510 $ 173,000 $ 1,125,498 $ - $ - $ - $ 1,683,805 $ 12,600 $ 3,792,413 Notes: (a) Energy Blueprint includes Motors and Cool Choice (b) Other expenses include: Performance Management Fee Smart Living Center Lease Smart Living Center Utilities ECSU Energy Conservation Loan Fund Neighborhood Housing Services C&LM Loan Defaults NEEP Participation Dues Postage Telephone Expense SUB-TOTAL C&I $ 1,543,630 $ 13,100 $ 1,209,390 $ 148,000 $ 11,053,051 $ 194,000 $ 22,500 $ 1,047,698 $ 15,231,369 TOTAL C&LM BUDGET $ 3,234,903 $ 252,350 $ 4,275,288 $ 236,000 $ 18,695,024 $ 1,654,333 $ 4,309,438 $ 1,120,298 $ 33,777,634 52

59 Table C 2014 Pie THE UNITED ILLUMINATING COMPANY 2014 CONSERVATION & LOAD MANAGEMENT C&LM BUDGET BY EXPENSE CLASS Other 12.76% Administrative Expenses 3.32% UI Labor 9.58% Materials & Supplies 0.75% Outside Services 12.66% Marketing 4.90% Contractor Labor 0.70% Incentives 55.35% Expense Classes Budget % of Budget UI Labor $ 3,234, % Materials & Supplies $ 252, % Outside Services $ 4,275, % Contractor Labor $ 236, % Incentives $ 18,695, % Marketing $ 1,654, % Other $ 4,309, % Administrative Expenses $ 1,120, % Total $ 33,777, % 53

60 Table C 2015 UI Budget THE UNITED ILLUMINATING COMPANY 2015 CONSERVATION & LOAD MANAGEMENT TABLE C PROGRAM NAME UI Labor Materials & Supplies Outside Services Contractor Labor Incentives Marketing Other (b) Administrative Expenses TOTAL Residential Retail Products $ 140,486 $ 6,000 $ 265,000 $ - $ 2,585,123 $ 250,000 $ 8,000 $ 5,000 $ 3,259,609 TOTAL - CONSUMER PRODUCTS $ 140,486 $ 6,000 $ 265,000 $ - $ 2,585,123 $ 250,000 $ 8,000 $ 5,000 $ 3,259,609 Residential New Construction $ 24,742 $ 1,500 $ 5,000 $ - $ 96,042 $ 15,000 $ 3,000 $ 2,500 $ 147,784 Home Energy Solutions $ 245,392 $ 15,000 $ 294,000 $ - $ 2,858,611 $ 140,000 $ 15,000 $ 19,000 $ 3,587,003 HES Income Eligible $ 306,517 $ 20,000 $ 100,000 $ - $ 2,799,803 $ 55,000 $ 4,000 $ 8,500 $ 3,293,820 Residential Behavior $ 10,050 $ 3,750 $ 204,450 $ - $ - $ 75,000 $ 3,750 $ 3,000 $ 300,000 SUB-TOTAL RESIDENTIAL $ 727,187 $ 46,250 $ 868,450 $ - $ 8,339,579 $ 535,000 $ 33,750 $ 38,000 $ 10,588,216 Energy Conscious Blueprint (a) $ 502,305 $ 3,500 $ 275,000 $ 50,000 $ 2,834,195 $ 42,000 $ 10,000 $ 60,000 $ 3,777,000 TOTAL - LOST OPPORTUNITY $ 502,305 $ 3,500 $ 275,000 $ 50,000 $ 2,834,195 $ 42,000 $ 10,000 $ 60,000 $ 3,777,000 Energy Opportunities $ 536,259 $ 6,000 $ 200,000 $ 70,000 $ 4,565,698 $ 86,000 $ 5,000 $ 384,500 $ 5,853,457 O&M Services (RFP, BSC, Training, RetroX, PRIME) $ 153,120 $ 1,600 $ 584,390 $ - $ 988,867 $ 24,000 $ 5,000 $ 18,000 $ 1,774,977 TOTAL - C&I LARGE RETROFIT $ 689,379 $ 7,600 $ 784,390 $ 70,000 $ 5,554,565 $ 110,000 $ 10,000 $ 402,500 $ 7,628,434 Small Business $ 351,946 $ 2,000 $ 150,000 $ 28,000 $ 2,664,291 $ 42,000 $ 2,500 $ 585,198 $ 3,825,935 SmartLiving Center $ 45,470 $ 10,000 $ 65,044 $ 88,000 $ - $ 25,000 $ 178,000 $ 2,000 $ 413,514 Clean Energy Communities $ 49,206 $ 5,000 $ 202,754 $ - $ - $ 79,000 $ 5,000 $ 15,000 $ 355,960 K-12 Education $ 41,449 $ 6,000 $ 197,925 $ - $ 30,000 $ 38,000 $ 2,500 $ 5,000 $ 320,874 Customer Engagement $ - $ - $ 120,000 $ - $ - $ - $ - $ - $ 120,000 SUB-TOTAL EDUCATION $ 136,125 $ 21,000 $ 585,723 $ 88,000 $ 30,000 $ 142,000 $ 185,500 $ 22,000 $ 1,210,348 Institute for Sustainable Energy (ECSU) $ - $ - $ - $ - $ - $ - $ 89,600 $ - $ 89,600 Residential Loan Program (Includes ECLF) $ 30,451 $ - $ - $ - $ - $ - $ 352,109 $ - $ 382,560 C&I Loan Program $ - $ - $ - $ - $ - $ - $ 693,123 $ - $ 693,123 C&LM Loan Defaults $ - $ - $ - $ - $ - $ - $ 31,111 $ - $ 31,111 C&I Self Funding $ - $ - $ - $ - $ - $ - $ 1,000,000 $ - $ 1,000,000 SUB-TOTAL PROGRAMS/REQUIREMENTS $ 30,451 $ - $ - $ - $ - $ - $ 2,165,943 $ - $ 2,196,394 Research, Development & Demonstration $ - $ - $ 132,692 $ - $ - $ - $ - $ - $ 132,692 SUB-TOTAL RENEWABLES AND RD&D $ - $ - $ 132,692 $ - $ - $ - $ - $ - $ 132,692 Administration $ 439,918 $ 20,000 $ 75,323 $ - $ - $ - $ - $ 5,000 $ 540,241 ESPCP Program Manager $ - $ - $ 19,200 $ - $ - $ - $ - $ - $ 19,200 Planning $ 251,830 $ - $ - $ - $ - $ - $ - $ 5,000 $ 256,830 Evaluation Studies $ 79,119 $ - $ 542,602 $ - $ - $ - $ - $ - $ 621,721 Evaluation Consultant $ - $ - $ 58,311 $ - $ - $ - $ - $ - $ 58,311 Information Technology $ 26,643 $ 153,000 $ 79,645 $ - $ - $ - $ - $ 2,600 $ 261,888 EEB $ - $ - $ 241,009 $ - $ - $ - $ - $ - $ 241,009 Marketing Plan $ - $ - $ - $ - $ - $ 813,333 $ - $ - $ 813, Performance Management Fee $ - $ - $ - $ - $ - $ - $ 1,593,612 $ - $ 1,593,612 SUB-TOTAL ADMIN & PLANNING $ 797,510 $ 173,000 $ 1,016,090 $ - $ - $ 813,333 $ 1,593,612 $ 12,600 $ 4,406,145 PROGRAM SUB-TOTALS RESIDENTIAL $ 874,828 $ 64,250 $ 1,376,613 $ 70,400 $ 8,369,579 $ 1,306,866 $ 534,759 $ 56,600 $ 12,653,896 COMMERCIAL & INDUSTRIAL $ 1,562,565 $ 16,100 $ 1,286,950 $ 165,600 $ 11,053,051 $ 377,467 $ 1,783,334 $ 1,051,098 $ 17,296,164 OTHER $ 797,510 $ 173,000 $ 1,148,782 $ - $ - $ - $ 1,683,212 $ 12,600 $ 3,815,104 Notes: (a) Energy Blueprint includes Motors and Cool Choice (b) Other expenses include: Performance Management Fee Smart Living Center Lease Smart Living Center Utilities ECSU Energy Conservation Loan Fund Neighborhood Housing Services C&LM Loan Defaults NEEP Participation Dues Postage Telephone Expense SUB-TOTAL C&I $ 1,543,630 $ 13,100 $ 1,209,390 $ 148,000 $ 11,053,051 $ 194,000 $ 22,500 $ 1,047,698 $ 15,231,369 TOTAL C&LM BUDGET $ 3,234,903 $ 253,350 $ 3,812,345 $ 236,000 $ 19,422,630 $ 1,684,333 $ 4,001,305 $ 1,120,298 $ 33,765,164 54

61 Table C 2015 Pie THE UNITED ILLUMINATING COMPANY 2015 CONSERVATION & LOAD MANAGEMENT C&LM BUDGET BY EXPENSE CLASS Other 11.85% Administrative Expenses 3.32% UI Labor 9.58% Materials & Supplies 0.75% Outside Services 11.29% Marketing 4.99% Contractor Labor 0.70% Incentives 57.52% Expense Classes Budget % of Budget UI Labor $ 3,234, % Materials & Supplies $ 253, % Outside Services $ 3,812, % Contractor Labor $ 236, % Incentives $ 19,422, % Marketing $ 1,684, % Other $ 4,001, % Administrative Expenses $ 1,120, % Total $ 33,765, % 55

62 Table D UI Historical and Projected Program Expenditures and kw Table D UI Historical and Projected $ and kw Expenditures $ (000) RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal Residential Retail Products 1,589 1, ,267 1,592 1,664 1,247 1,282 1,344 2,430 2,632 2,401 2,084 2,975 3,260 Appliance Retirement Total - Consumer Products 1,589 1, ,134 2,479 1,773 1,247 1,442 1,344 2,430 2,632 2,401 2,084 2,975 3,260 Residential New Construction , Home Energy Solutions ,079 2,067 3,090 3,883 3,106 2,991 2,958 3,055 3,587 HES Income Eligible 1,500 1, ,086 1,250 1, ,448 2,976 3,107 2,738 4,776 3,254 3,294 Residential Behavior Subtotal RESIDENTIAL 3,815 3,277 2,016 3,966 5,378 4,182 3,586 4,888 8,080 9,465 8,894 8,386 9,990 9,739 10,588 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 2,304 2,019 1,963 2,021 3,787 3,174 5,051 3,422 4,337 5,270 3,011 2,184 2,103 3,777 3,777 Total - Lost Opportunity 2,304 2,019 1,963 2,021 3,787 3,174 5,051 3,422 4,337 5,270 3,011 2,184 2,103 3,777 3,777 C&I LARGE RETROFIT C&I RFP Energy Opportunities 3,401 1,271 1,169 2,259 3,917 2,977 5,843 3,119 4,789 4,845 4,912 3,377 4,124 5,853 5,853 O&M (RetroCx, BSC, RFP,PRIME) ,775 1,775 Municipal Energy & Schools Total - C&I Large Retrofit 4,357 2,134 1,997 3,190 5,240 3,049 5,984 3,136 4,922 5,033 5,035 3,629 4,482 7,628 7,628 Small Business 1, ,386 1,638 1,842 2,145 2,170 2,972 1,474 2,639 2,404 3,826 3,826 Subtotal C&I 8,058 5,150 4,806 6,055 10,413 7,861 12,877 8,703 11,429 13,275 9,520 8,452 8,989 15,231 15,231 OTHER - LOAD MANAGEMENT ISO Load Response Program Support Subtotal Load Management PROGRAM SUB-TOTALS Residential 3,815 3,277 2,016 3,966 5,378 4,182 3,586 4,888 8,080 9,465 8,894 8,386 9,990 9,739 10,588 C&I 8,121 5,574 5,410 6,088 10,622 7,872 12,885 8,709 11,433 13,275 9,520 8,452 8,989 15,231 15,231 TOTAL 11,936 8,851 7,426 10,054 16,000 12,054 16,471 13,597 19,513 22,740 18,414 16,838 18,979 24,970 25,820 Load Savings kw RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal Residential Retail Products ,286 1,339 1,158 1,615 1,613 1,186 3,788 4,008 2,008 1,860 1,518 1,216 Appliance Retirement Total - Consumer Products ,922 1,830 1,194 1,615 1,626 1,186 3,788 4,008 2,008 1,860 1,518 1,216 Residential New Construction Home Energy Solutions 132 2, , , HES Income Eligible Residential Behavior Subtotal RESIDENTIAL 1,608 3,438 1,315 3,117 3,518 2,530 2,657 3,055 2,478 5,625 5,084 2,762 2,933 2,638 2,403 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 5,134 3,761 3,815 4,180 4,367 4,685 2,622 2,337 2,620 1,329 1,071 1,539 1,267 1,486 1,476 Total - Lost Opportunity 5,134 3,761 3,815 4,180 4,367 4,685 2,622 2,337 2,620 1,329 1,071 1,539 1,267 1,486 1,476 C&I LARGE RETROFIT C&I RFP Energy Opportunities 4,799 2,467 2,191 3,180 3,850 3,345 3,993 3,530 2,977 2,303 1,840 1,844 1,164 2,043 1,905 O&M (RetroCx, BSC, RFP,PRIME) ,063 1,063 Municipal Energy & Schools 859 1,107 1,317 1, Total - C&I Large Retrofit 5,694 3,661 4,029 4,258 5,032 3,582 4,048 3,530 3,004 2,303 1,874 1,855 1,184 3,106 2,968 Small Business ,031 1,035 1,963 1,661 2,008 2,149 1,574 1, ,228 1,232 Subtotal C&I 11,511 8,081 8,875 9,473 11,362 9,927 8,678 8,016 7,198 4,804 3,756 4,209 3,030 5,820 5,675 OTHER - LOAD MANAGEMENT ISO Load Response Program Support 10,925 10,925 14,465 3,975 2,060 3,338 2,867 1, Subtotal Load Management 10,925 10,925 14,465 3,975 2,060 3, PROGRAM SUB-TOTALS Residential 1,608 3,438 1,315 3,117 3,518 2,530 2,657 3,055 2,478 5,625 5,084 2,762 2,933 2,638 2,403 C&I 22,436 19,006 23,340 13,448 13,422 13,265 11,545 9,884 7,980 4,893 3,756 4,209 3,030 5,820 5,675 TOTAL 24,044 22,444 24,655 16,565 16,940 15,795 14,202 12,939 10,458 10,518 8,840 6,971 5,963 8,458 8,078 56

63 Table D1 UI Historical and Projected Annual kwh and Lifetime kwh Table D1 UI Historical and Projected Annual kwh and Lifetime kwh Annual kwh (000) RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal Residential Retail Products 9,563 7,997 3,465 12,166 14,968 15,216 21,152 17,390 12,485 42,955 45,644 22,554 21,333 17,107 13,880 Appliance Retirement ,667 2, Total - Consumer Products 9,563 7,997 3,465 14,833 17,535 15,477 21,152 17,397 12,485 42,955 45,644 22,554 21,333 17,107 13,880 Residential New Construction ,038 1,038 1, Home Energy Solutions 75 1, ,063 3,331 2,515 5,134 3,541 3,582 2,344 3,255 3,657 HES Income Eligible 6,086 5,550 2,779 4,052 5,130 4,784 3,498 2,511 3,122 4,204 4,710 3,131 3,787 3,557 3,533 Residential Behavior Subtotal RESIDENTIAL 15,932 14,993 6,772 19,685 24,220 21,754 27,385 24,041 18,184 52,416 54,191 29,368 27,644 24,918 22,051 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 25,568 18,731 10,994 22,420 20,122 13,765 15,090 14,302 16,308 11,355 10,653 7,098 8,277 9,256 9,212 Total - Lost Opportunity 25,568 18,731 10,994 22,420 20,122 13,765 15,090 14,302 16,308 11,355 10,653 7,098 8,277 9,256 9,212 C&I LARGE RETROFIT C&I RFP , Energy Opportunities 25,592 13,156 11,929 18,591 24,167 20,704 21,573 20,668 18,128 16,948 16,012 14,860 10,833 15,120 14,911 O&M (RetroCx, BSC, RFP,PRIME) ,206 1,453 2, ,939 9,320 9,126 Municipal Energy & Schools 4,278 5,511 4,240 5,497 2, Total - C&I Large Retrofit 30,098 19,211 18,583 24,944 28,995 22,157 23,959 20,668 18,626 17,401 16,149 15,610 12,772 24,441 24,037 Small Business 6,506 6,279 3,578 4,399 7,590 5,830 7,644 9,480 7,914 7,789 5,115 6,321 5,131 7,957 7,970 Subtotal C&I 62,172 44,221 33,155 51,763 56,707 41,752 46,693 44,450 42,848 36,545 31,917 29,029 26,180 41,653 41,219 PROGRAM SUB-TOTALS Residential 15,932 14,993 6,772 19,685 24,220 21,754 27,385 24,041 18,184 52,416 54,191 29,368 27,644 24,918 22,051 C&I 62,172 44,221 33,155 51,763 56,707 41,752 46,693 44,450 42,848 36,545 31,917 29,029 26,180 41,653 41,219 TOTAL 78,104 59,214 39,927 71,448 80,927 63,506 74,078 68,491 61,032 88,961 86,108 58,397 53,824 66,571 63,270 Lifetime kwh (000) RESIDENTIAL Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal Residential Retail Products 114,927 87,336 34, , , , , ,890 84, , , , , , ,051 Appliance Retirement ,002 12,761 1, Total - Consumer Products 114,927 87,336 34, , , , , ,980 84, , , , , , ,051 Residential New Construction 4,338 5,044 5,940 7,412 11,240 15,812 23,327 12, ,542 3,452 1,113 1,702 2,418 2,217 Home Energy Solutions 1,125 18,240 4,389 7,839 8,264 5,866 11,997 33,731 31,331 51,377 31,175 38,988 23,439 34,577 38,911 HES Income Eligible 60,860 55,500 24,412 17,352 36,581 36,749 32,294 20,676 24,878 40,905 52,757 35,418 46,117 33,365 33,560 Residential Behavior ,175 8,175 Subtotal RESIDENTIAL 181, ,120 68, , , , , , , , , , , , ,914 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Blueprint / Energy Conscious Construction 383, , , , , , , , , , , , , , ,369 Total - Lost Opportunity 383, , , , , , , , , , , , , , ,369 C&I LARGE RETROFIT C&I RFP 3,420 8,160 36,210 12,835 10, Energy Opportunities 383, , , , , , , , , , , , , , ,408 O&M (RetroCx, BSC, RFP,PRIME) ,061 21,790 35,790-3,640 2, ,177 14,596 68,671 67,698 Municipal Energy & Schools 64,170 82,665 63,600 82,451 36, Total - C&I Large Retrofit 450, , , , , , , , , , , , , , ,106 Small Business 97,600 94,200 53,670 65, ,909 76,975 92,649 99,684 88,186 97,574 63,381 79,627 65, , ,903 Subtotal C&I 931, , , , , , , , , , , , , , ,378 PROGRAM SUB-TOTALS Residential 181, ,120 68, , , , , , , , , , , , ,914 C&I 931, , , , , , , , , , , , , , ,378 TOTAL 1,113, , , ,010 1,122, , , , , , , , , , ,292 57

64 Incentive $ Earned UI Performance Incentive 2014 THE UNITED ILLUMINATING COMPANY 2014 Management Incentive Performance Indicators and Incentive Matrix Provided below is the 2014 Incentive Matrix with Performance Indicators. The weights applied to each of the individual and sector level metrics were developed in collaboration with EEB consultants. The Utility Performance Incentive is $1,594,205. This calculated is based on achieving 100% of all performance targets and earning a target incentive of 5% of C&LM budgets (not including ECMB costs, Audit Costs or Management Incentive). Goals will be prorated based on actual over/under spend of budget. The actual incentive earned will be determined by the performance achieved in each of the Incentive Metrics identified below, based on the following Performance Index: Incentive $ Earned vs. Performance Achieved Performance % Pretax Incentive Pre-tax Incentive $2,000,000 $1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200, % $797, % $956, % $1,275, % $1,594, % $1,913, % $2,231, % $2,550, Performance Achieved % of Target Total Original Budget* $31,884,108 *Does not include Incentive, ECMB costs and Audit 58

65 UI Performance Incentive 2014 (cont.) SECTOR Program Performance Indicators RESIDENTIAL All Residential Programs (Sector Level) Sector Budget $ 9,738,610 Residential Products & Services Lifetime kwh 132,638,950 Residential Products & Services kw 1,518 Homes Lifetime kwh 2,417,534 Homes kw 61 Home Energy Solutions Lifetime kwh 34,577,081 Home Energy Solutions kw 552 HES Income Eligible Lifetime kwh 33,364,701 HES Income Eligible kw 274 Residential Behavior Lifetime kwh 8,175,000 Residential Behavior kw 233 Total Residential Lifetime kwh 211,173,266 Total Residential kw 2,638 Present Value of Res Lifetime kwh $ Present Value of Res Lifetime Customer Meter $1, Total Res Lifetime Present Value Factor $16,708,174 Total Res Present Value Factor $3,002,843 Total Electric System Benefit $19,711,017 All Residential Programs (Sector Level) The Net Electric System Benefit from all Res programs Total NetElectric System System Benefit $9,972,407 Residential New Construction $ 154,242 Incentive Metrics Incentive Metric Target Goal Weight Incentive Total Electric System Benefit from all Res programs Electric System Benefit from all Res programs Total Electric System Benefit: $19,711, $310,870 Energy savings included in appropriate sector level metric $9,972,407 $9,972, $310,870 59

66 UI Performance Incentive 2014 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive RESIDENTIAL HES $ 3,055,354 Increase HES Savings (MMBTU) Per Single Family Home (1 to 4 units) 4% over 2013 (or MMBTU) Increase HES Savings (MMBTU) Multi-Family (5 units and above) 8% over 2012 actual (or 8.09 MMBTU) Energy savings included in appropriate sector level metric Increase HES savings Per Participant Increase HES savings Per Home Achieve 4% average increase in HES per participant savings across all fuels Achieve 8% average increase in HES per participant savings across all fuels 0.02 $31, $15,942 Percentage of Unique Single Family Homes that received core services for HES that get at least one add-on measures (i.e., insulation, Water Heaters, HVAC, appliances). % of homes with Add-Ons 24% of unique homes with at least one Add-On Measure, measured Jan 1, through Sept, 30, $31,884 HES - Income Eligible $ 3,253,718 Expend the HES-IE Budget - Full Penalty is 5% times HES-IE Budgeted Spending. Expending 95% spending avoids the penalty. The penalty is on sliding scale from 85% to 95%. Above 85% spending, the penalty is scaled with a 10% reduction in the penalty for each one percent increase in budget spend above 85%. Energy savings included in appropriate sector level metric Expend 2014 HES-IE Budget This is a penalty metric - 5% Annual MMBTU for electric, oil and propane measures Annual MMBTU 23, $31,884 MMBTU Retail Products $ 2,975,296 Number of LED Products Number of LED Products 174, $31,884 60

67 UI Performance Incentive 2014 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive COMMERCIAL & INDUSTRIAL (C/I) All C/I Programs (Sector $ 15,231,369 Energy Blueprint Lifetime kwh 137,587,135 Level) Sector Budget Energy Blueprint kw 1,486 Total Electric System Benefit from all C&I programs. Electric System Benefit from all C&I programs Total Electric System Benefit: 0.21 $334,783 Energy Opportunities Lifetime kwh 174,350,285 $47,789,146 Energy Opportunities kw 2,043 O&M (RetroCx, BOC, RFP) 68,671,318 O&M RFP kw 1,063 Small Business Lifetime kwh 101,700,141 Small Business kw 1,228 Total C&I Lifetime kwh 482,308,879 Total C&I kw 5,820 Present Value of C&I Lifetime kwh $ Present Value of C&I Lifetime Customer Meter $1, Total C&I Lifetime Present Value Factor $38,761,193 Total C&I Present Value Factor $9,027,953 Total Electric System Benefit $47,789,146 The Net Electric System Benefit from all C&I programs: $32,557,777 All C/I Programs (Sector Level) Sector Budget Total Net Electric System Benefit from all C&I programs. $32,557,777 Total Program Benefit from all C&I programs $334,783 61

68 UI Performance Incentive 2014 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive COMMERCIAL & INDUSTRIAL (C/I) Small Business $ 3,825,935 Comprehensive Signed Projects. Comprehensive is defined as 1. More than 1 electric End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, or involve a natural gas measure End-Use. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings. Small Business projects may also be comprehensive by utilizing bundled measures. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Energy Star Natural Gas or Electric Dishwashers. 16% of signed projects will be comprehensive $31,884 Energy Conscious Blueprint $ 3,777,000 Number of new construction/major renovation projects that are more efficient than the State Energy Code and are: - 30% > ASHRAE , or - 20% > ASHRAE , or - utilize Whole Building Performance, or Net Zero Energy projects 40% of signed projects 0.02 $31,884 Net Zero Energy project shall include renewable energy technologies such as, but not limited to, Solar PV, Solar Thermal, Fuel Cells, CHP, and Wind. Energy Opportunities $ 5,853,457 Number of projects that are comprehensive 20% of signed projects 0.02 $31,884 Comprehensive is defined as 1. More than 1 electric End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, or involve a natural gas measure End-Use. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings 62

69 UI Performance Incentive 2014 (cont.) SECTOR Program Performance Indicators COMMERCIAL & INDUSTRIAL (C/I) Strategic Energy Management SEM signed Customer agreements may include, but not be limited to, BSC Agreements (*), Retro-Commissioning engineering study agreements, multi-year MOU s with Customers (which will outline a strategic plan for reducing consumption by a specific percentage each year along with tools and resources to be utilized such as metering, trending & reporting, Energy Star Benchmarking, Focused Study agreements, PRIME kaizen events, etc.), Clean Energy Community MOU s, packaged SEM and Customer Engagement tools and resources which already exist in the marketplace. (*) BSC = Business Sustainability Challenge. Manufacturing Customers Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the electric energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] - All C&I Programs Electric Savings Total Incentive $ Residential and C&I Incentive Metrics Incentive Metric Target Goal Weight Incentive 12 Customers 0.02 $31,884 20% of savings via signed contracts 0.02 $31,884 Electric Savings include in appropriate sector level metric $1,594,205 63

70 Incentive $ Earned UI Performance Incentive 2015 THE UNITED ILLUMINATING COMPANY 2015 Management Incentive Performance Indicators and Incentive Matrix Provided below is the 2015 Incentive Matrix with Performance Indicators. The weights applied to each of the individual and sector level metrics were developed in collaboration with EEB consultants. The Utility Performance Incentive is $1,593,612. This calculated is based on achieving 100% of all performance targets and earning a target incentive of 5% of C&LM budgets (not including ECMB costs, Audit Costs or Management Incentive). Goals will be prorated based on actual over/under spend of budget. The actual incentive earned will be determined by the performance achieved in each of the Incentive Metrics identified below, based on the following Performance Index: Performance % Pretax Incentive Pre-tax Incentive Incentive $ Earned vs Performance Achieved 80 3% $956, % $1,274, % $1,593, % $1,912, % $2,231, % $2,549,779 $2,000,000 $1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200, Total Original Budget* $31,872,232 Performance Achieved % of Target *Does not include Incentive, ECMB costs and Audit 64

71 UI Performance Incentive 2015 (cont.) SECTOR Program Performance Indicators RESIDENTIAL All Residential Programs (Sector Level) Sector Budget $ 10,588,216 Residential Products & Services Lifetime kwh 113,050,853 Residential Products & Services kw 1,216 Homes Lifetime kwh 2,216,851 Homes kw 58 Home Energy Solutions Lifetime kwh 38,911,302 Home Energy Solutions kw 623 HES Income Eligible Lifetime kwh 33,560,091 HES Income Eligible kw 273 Residential Behavior Lifetime kwh 8,175,000 Residential Behavior kw 233 Total Residential Lifetime kwh 195,914,097 Total Residential kw 2,403 Present Value of Res Lifetime kwh $ Present Value of Res Lifetime Customer Meter $1, Total Res Lifetime Present Value Factor $15,532,790 Total Res Present Value Factor $2,903,400 Total Electric System Benefit $18,436,190 All Residential Programs (Sector Level) The Net Electric System Benefit from all Res programs Total Net Electric System Benefit $7,847,974 Incentive Metrics Incentive Metric Target Goal Weight Incentive Total Electric System Benefit from all Res programs Electric System Benefit from all Res programs Total Electric System Benefit: $18,436, $310,754 $7,847,974 $7,847, $310,754 65

72 UI Performance Incentive 2015 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive RESIDENTIAL Residential New Construction $ 147,784 HES $ 3,587,003 Increase HES Savings (MMBTU) Per Single Family Home (1 to 4 units) over 2014 Increase HES Savings (MMBTU) Multi-Family (5 units and above) over 2014 Energy savings included in appropriate sector level metric Energy savings included in appropriate sector level metric Increase HES savings Per Particpant Increase HES savings Per Home Achieve 4% average increase in HES per participant savings across all fuels Achieve 8% average increase in HES per participant savings across all fuels 0.02 $31, $15,936 Percentage of Unique Single Family Homes that received core services for HES that get at least one add-on measures (i.e., insulation, Water Heaters, HVAC, appliances). % of homes with Add-Ons 26% of unique homes with at least one Add-On Measure, measured Jan 1, through Sept, 30, $31,872 HES - Income Eligible $ 3,293,820 Expend the HES-IE Budget - Full Penalty is 5% times HES- IE Budgeted Spending. Expending 95% spending avoids the penalty. The penalty is on sliding scale from 85% to 95%. Above 85% spending, the penalty is scaled with a 10% reduction in the penalty for each one percent increase in budget spend above 85%. Retail Products $ 3,259,609 Number of LED Products Energy savings included in appropriate sector level metric Expend 2015 HES-IE Budget This is a penalty metric - 5% Annual MMBTU for electric, oil and propane measures Annual MMBTU 23, $31,872 MMBTU Number of LED Products 215, $31,872 66

73 UI Performance Incentive 2015 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive COMMERCIAL & INDUSTRIAL (C/I) All C/I Programs (Sector Level) Sector Budget $ 15,231,369 Energy Blueprint Lifetime kwh 137,368,960 Energy Blueprint kw 1,476 Total Electric System Benefit from all C&I programs. Electric System Benefit from all C&I programs Total Electric System Benefit: 0.21 $334,658 Energy Opportunities Lifetime kwh 162,407,557 $48,638,579 Energy Opportunities kw 1,905 O&M (RetroCx, BOC, RFP) 67,698,357 O&M RFP kw 1,063 Small Business Lifetime kwh 101,903,445 Small Business kw 1,232 Total C&I Lifetime kwh 469,378,319 Total C&I kw 5,675 Present Value of C&I Lifetime kwh $ Present Value of C&I Lifetime Customer Meter $1, Total C&I Lifetime Present Value Factor $38,845,295 Total C&I Present Value Factor $9,793,284 Total Electric System Benefit $48,638,579 The Net Electric System Benefit from all C&I programs: $33,407,210 All C/I Programs (Sector Level) Sector Budget Total Net Electric System Benefit from all C&I programs. $33,407,210 Total Program Benefit from all C&I programs $334,658 67

74 UI Performance Incentive 2015 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive Small Business $ 3,825,935 Comprehensive Signed Projects. 20% of signed projects will be comprehensive $31,872 Comprehensive is defined as 1. More than 1 electric End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, or involve a natural gas measure End-Use. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings. Small Business projects may also be comprehensive by utilizing bundled measures. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Energy Star Natural Gas or Electric Dishwashers. Energy Conscious Blueprint $ 3,777,000 Number of new construction/major renovation projects that are more efficient than the State Energy Code and are: - 30% > ASHRAE , or - 20% > ASHRAE , or - utilize Whole Building Performance, or Net Zero Energy projects 50% of signed projects 0.02 $31,872 Net Zero Energy project shall include renewable energy technologies such as, but not limited to, Solar PV, Solar Thermal, Fuel Cells, CHP, and Wind. Energy Opportunities $ 5,853,457 Number of projects that are comprehensive 25% of signed projects 0.02 $31,872 Comprehensive is defined as 1. More than 1 electric End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, or involve a natural gas measure End-Use. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings 68

75 UI Performance Incentive 2015 (cont.) SECTOR Program Performance Indicators Strategic Energy Management Manufacturing Customers SEM signed Customer agreements may include, but not be limited to, BSC Agreements (*), Retro-Commissioning engineering Energy savings study from agreements, Signed Manufacturing multi- Customer projects. Energy Savings includes the electric energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] - All C&I Programs Electric Savings Total Incentive $ Residential and C&I Incentive Metrics Incentive Metric Target Goal Weight Incentive 25 Customers 0.02 $31,872 22% of savings via signed contracts 0.02 $31,872 Electric Savings include in appropriate sector level metric $1,593,612 69

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77 Combined Natural Gas Companies Budget Tables 71

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79 Table A Combined Natural Gas Companies Plan Table A1 YGS, CNG & SCG Natural Gas Budgets YGS CNG SCG Combined YGS CNG SCG Combined Natural Gas C&LM Budget DEEP Decision** DEEP Decision** DEEP Decision** YGS/CNG/SCG DEEP Decision** DEEP Decision** DEEP Decision** YGS/CNG/SCG 10/31/13 10/31/13 10/31/13 Total 10/31/13 10/31/13 10/31/13 Total RESIDENTIAL HES Income Eligible $ 3,515,825 $ 2,744,857 $ 2,680,076 $ 8,940,758 $ 3,229,906 $ 2,721,693 $ 2,554,642 $ 8,506,241 Home Energy Solutions (HES) $ 6,119,355 $ 4,471,024 $ 2,545,354 $ 13,135,733 $ 5,452,495 $ 4,742,979 $ 2,711,657 $ 12,907,131 Residential New Construction $ 770,000 $ 446,750 $ 351,535 $ 1,568,285 $ 881,119 $ 425,376 $ 330,790 $ 1,637,285 Water Heating $ 347,587 $ 300,238 $ 300,238 $ 948,063 $ 348,524 $ 307,471 $ 307,471 $ 963,466 Residential Behavior $ - $ - $ 541,800 $ 541,800 $ - $ - $ 451,800 $ 451,800 Subtotal Residential $ 10,752,767 $ 7,962,869 $ 6,419,003 $ 25,134,639 $ 9,912,044 $ 8,197,519 $ 6,356,360 $ 24,465,923 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint $ 3,059,208 $ 1,957,423 $ 1,357,784 $ 6,374,415 $ 3,591,970 $ 1,987,642 $ 1,336,803 $ 6,916,415 Total - Lost Opportunity $ 3,059,208 $ 1,957,423 $ 1,357,784 $ 6,374,415 $ 3,591,970 $ 1,987,642 $ 1,336,803 $ 6,916,415 C&I LARGE RETROFIT Energy Opportunities $ 1,586,356 $ 1,025,782 $ 628,862 $ 3,241,000 $ 1,994,840 $ 1,039,762 $ 620,398 $ 3,655,000 Business & Energy Sustainability (O&M, RetroCx, BSC) $ 609,074 $ 574,201 $ 477,726 $ 1,661,000 $ 574,003 $ 707,186 $ 575,811 $ 1,857,000 Total - C&I Large Retrofit $ 2,195,430 $ 1,599,982 $ 1,106,588 $ 4,902,000 $ 2,568,843 $ 1,746,948 $ 1,196,209 $ 5,512,000 Small Business $ 230,662 $ 160,008 $ 124,329 $ 515,000 $ 269,823 $ 166,030 $ 127,147 $ 563,000 Subtotal C&I $ 5,485,299 $ 3,717,414 $ 2,588,701 $ 11,791,415 $ 6,430,636 $ 3,900,620 $ 2,660,159 $ 12,991,415 OTHER - Education SmartLiving Center -Museums Partnership $ 173,333 $ 173,333 $ 173,333 $ 520,000 $ 82,000 $ 82,000 $ 82,000 $ 246,000 Clean Energy Communities / Behavior Pilot $ 143,333 $ 143,333 $ 143,333 $ 430,000 $ 143,333 $ 143,333 $ 143,333 $ 430,000 EESmarts/K-12 $ 66,667 $ 66,667 $ 66,667 $ 200,000 $ 66,667 $ 66,667 $ 66,667 $ 200,000 Customer Engagement $ 50,000 $ 50,000 $ 50,000 $ 150,000 $ 50,000 $ 50,000 $ 50,000 $ 150,000 Subtotal Education $ 433,333 $ 433,333 $ 433,333 $ 1,300,000 $ 342,000 $ 342,000 $ 342,000 $ 1,026,000 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy $ 37,333 $ 37,333 $ 37,333 $ 112,000 $ 37,333 $ 37,333 $ 37,333 $ 112,000 ESPC Project Manager - Lead By Example $ 9,600 $ 9,600 $ 9,600 $ 28,800 $ 9,600 $ 9,600 $ 9,600 $ 28,800 Residential Financing (includes ECLF) $ 118,910 $ 100,045 $ 100,045 $ 319,000 $ 145,083 $ 99,959 $ 99,959 $ 345,000 C&LM Loan Defaults $ 79,667 $ 79,667 $ 79,667 $ 239,000 $ 86,333 $ 86,333 $ 86,333 $ 259,000 C&I Loan Program $ 89,000 $ 75,000 $ 75,000 $ 239,000 $ 109,000 $ 75,000 $ 75,000 $ 259,000 Subtotal Programs/Requirements $ 334,510 $ 301,645 $ 301,645 $ 937,800 $ 387,349 $ 308,225 $ 308,225 $ 1,003,800 Research, Development and Demonstration $ 59,000 $ 50,000 $ 50,000 $ 159,000 $ 72,000 $ 50,000 $ 50,000 $ 172,000 Subtotal RD&D $ 59,000 $ 50,000 $ 50,000 $ 159,000 $ 72,000 $ 50,000 $ 50,000 $ 172,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 119,220 $ 121,329 $ 121,329 $ 361,878 $ 119,220 $ 121,329 $ 121,329 $ 361,878 Marketing Plan $ 203,333 $ 203,333 $ 203,333 $ 610,000 $ 203,333 $ 203,333 $ 203,333 $ 609,999 Information Technology $ 133,333 $ 133,333 $ 133,333 $ 400,000 $ 133,333 $ 133,333 $ 133,333 $ 400,000 Planning $ 80,000 $ 80,000 $ 80,000 $ 240,000 $ 80,000 $ 80,000 $ 80,000 $ 240,000 Evaluation $ 252,873 $ 228,883 $ 228,883 $ 710,639 $ 271,404 $ 245,717 $ 245,717 $ 762,838 Evaluation Consultant $ 24,297 $ 24,297 $ 24,297 $ 72,891 $ 24,297 $ 24,297 $ 24,297 $ 72,890 Energy Efficiency Board $ 50,210 $ 50,210 $ 50,210 $ 150,630 $ 50,210 $ 50,210 $ 50,210 $ 150,630 Performance Fee $ 892,683 $ 661,607 $ 527,978 $ 2,082,267 $ 897,566 $ 679,104 $ 525,023 $ 2,101,693 Subtotal Other - Administrative & Planning $ 1,755,948 $ 1,502,993 $ 1,369,363 $ 4,628,304 $ 1,779,363 $ 1,537,323 $ 1,383,242 $ 4,699,927 PROGRAM SUBTOTALS Residential $ 11,394,344 $ 8,585,580 $ 7,041,714 $ 27,021,638 $ 10,506,727 $ 8,747,077 $ 6,905,918 $ 26,159,722 C&I $ 5,777,566 $ 3,995,680 $ 2,866,967 $ 12,640,214 $ 6,731,303 $ 4,167,286 $ 2,926,826 $ 13,825,415 Other $ 1,648,949 $ 1,386,993 $ 1,253,363 $ 4,289,305 $ 1,685,363 $ 1,421,323 $ 1,267,242 $ 4,373,928 TOTAL $ 18,820,859 $ 13,968,253 $ 11,162,045 $ 43,951,157 $ 18,923,392 $ 14,335,687 $ 11,099,986 $ 44,359,066 ** Budgets are the DEEP approved budgets from October 31, 2013 Final Decision with technical corrections and some minor adjustments. 73

80 A Pie 74

81 A Pie Statewide 2015 Budget Analysis Table A1 Pie Chart Budget By Customer Class Commercial and Industrial, 34.58% Res. Income Eligible, 22.14% Res. Non Income Eligible, 43.29% Customer Class Budget ($,000) % of Total Conservation Budget % of Residential & C&I Budget Res. Income Eligible $8,851, % 22.14% Res. Non Income Eligible $17,308, % 43.29% Residential Subtotal $26,159, % 65.42% Commercial and Industrial $13,825, % 34.58% C&I Subtotal $13,825, % 34.58% Residential and C&I Subtotal $39,985, % % Other Expenditures Other Expenditures $4,373, % Other Expenditures Subtotal $4,373, % TOTAL $44,359, % Yankee $18,923, % CNG $14,335, % SCG $11,099, % 75

82 Table A Combined Natural Gas Companies Funding Sources Table A2 YGS, CNG & SCG Gas Conservation Plan Revenues Yankee CNG SCG Combined Yankee CNG SCG Combined Natural Gas C&LM Revenues Revenues Revenues Revenues YGS/CNG/SCG Revenues Revenues Revenues YGS/CNG/SCG Total Total Conservation Adjustment Mechanism (CAM) $ 18,820,859 $ 13,968,253 $ 11,162,045 $ 43,951,156 $ 18,923,392 $ 14,335,687 $ 11,099,986 $ 44,359,066 Total Revenues $ 18,820,859 $ 13,968,253 $ 11,162,045 $ 43,951,156 $ 18,923,392 $ 14,335,687 $ 11,099,986 $ 44,359,066 76

83 The Yankee Gas Services Company Budget Tables 77

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85 Table A Yankee Gas 2013 Actual Results, Budget Table A Yankee Gas Service Company Natural Gas Conservation Budgets Yankee YGS YGS Natural Gas C&LM Budget Actual DEEP Decision ** DEEP Decision ** Results 10/31/13 10/31/13 RESIDENTIAL HES Income Eligible $ 3,138,425 $ 3,515,825 $ 3,229,906 Home Energy Solutions (HES) $ 1,724,523 $ 6,119,355 $ 5,452,495 Residential New Construction $ 193,667 $ 770,000 $ 881,119 Water Heating $ 41,069 $ 347,587 $ 348,524 Subtotal Residential $ 5,097,684 $ 10,752,767 $ 9,912,044 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint $ 1,152,025 $ 3,059,208 $ 3,591,970 Total - Lost Opportunity $ 1,152,025 $ 3,059,208 $ 3,591,970 C&I LARGE RETROFIT Energy Opportunities $ 870,585 $ 1,586,356 $ 1,994,840 Business & Energy Sustainability (O&M, RetroCx, BSC) $ 94,554 $ 609,074 $ 574,003 Total - C&I Large Retrofit $ 965,139 $ 2,195,430 $ 2,568,843 Small Business $ 422,844 $ 230,662 $ 269,823 Subtotal C&I $ 2,540,008 $ 5,485,299 $ 6,430,636 OTHER - Education SmartLiving Center -Museums Partnership $ - $ 173,333 $ 82,000 Clean Energy Communities / Behavior Pilot $ - $ 143,333 $ 143,333 EESmarts/K-12 $ - $ 66,667 $ 66,667 Customer Engagement $ - $ 50,000 $ 50,000 Subtotal Education $ - $ 433,333 $ 342,000 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy $ - $ 37,333 $ 37,333 ESPC Project Manager - Lead By Example $ - $ 9,600 $ 9,600 Residential Financing (includes ECLF) $ 70,112 $ 118,910 $ 145,083 C&LM Loan Defaults $ - $ 79,667 $ 86,333 C&I Loan Program $ 294 $ 89,000 $ 109,000 Subtotal Programs/Requirements $ 70,406 $ 334,510 $ 387,349 Research, Development and Demonstration $ - $ 59,000 $ 72,000 Subtotal RD&D $ - $ 59,000 $ 72,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 51,486 $ 119,220 $ 119,220 Marketing Plan $ 8 $ 203,333 $ 203,333 Information Technology $ 51,196 $ 133,333 $ 133,333 Planning $ 103,533 $ 80,000 $ 80,000 Evaluation $ (17,049) $ 252,873 $ 271,404 Evaluation Consultant $ - $ 24,297 $ 24,297 Energy Efficiency Board $ 38,924 $ 50,210 $ 50,210 Performance Fee $ 605,725 $ 892,683 $ 897,566 Subtotal Other - Administrative & Planning $ 833,824 $ 1,755,948 $ 1,779,363 PROGRAM SUBTOTALS Residential $ 5,167,803 $ 11,394,344 $ 10,506,727 C&I $ 2,540,303 $ 5,777,566 $ 6,731,303 Other $ 833,816 $ 1,648,949 $ 1,685,363 TOTAL $ 8,541,922 $ 18,820,859 $ 18,923,392 ** Budgets are the DEEP approved budgets from October 31, 2013 Final Decision with technical corrections and some minor adjustments. 79

86 Table A 2014 Pie YGS 2014 Budget Analysis Budget By Customer Class Commercial and Industrial, 33.65% Res. Income Eligible, 21.17% Res. Non Income Eligible, 45.19% Customer Class Budget % of Total Conservation Budget % of Residential & C&I Budget Res. Income Eligible $3,634, % 21.17% Res. Non Income Eligible $7,759, % 45.19% Residential Subtotal $11,394, % 66.35% Commercial and Industrial $5,777, % 33.65% C&I Subtotal $5,777, % 33.65% Residential and C&I Subtotal $17,171, % % Other Expenditures Other Expenditures $1,648, % Other Expenditures Subtotal $1,648, % TOTAL $18,820, % 80

87 Table A 2015 Pie YGS 2015 Budget Analysis Budget by Customer class Commercial and Industrial, 39.05% Res. Income Eligible, 19.58% Res. Non Income Eligible, 41.37% Customer Class Budget % of Total Conservation Budget % of Residential & C&I Budget Res. Income Eligible $3,374, % 19.58% Res. Non Income Eligible $7,131, % 41.37% Residential Subtotal $10,506, % 60.95% Commercial and Industrial $6,731, % 39.05% C&I Subtotal $6,731, % 39.05% Residential and C&I Subtotal $17,238, % % Other Expenditures Other Expenditures $1,685, % Other Expenditures Subtotal $1,685, % TOTAL $18,923, % 81

88 Table B Yankee Gas Comparison of Program Energy Savings TABLE B-1, Energy Savings Yankee Gas 2014 Utility Costs Gas Costs # of Units Units Program (000) (000) Annualized Savings (ccf) Lifetime Savings (ccf) Peak Savings (ccf) RESIDENTIAL Cost Rate $/ccf Annualize Utility Cost Ratio $/LT-ccf Annual Oil Savings (gallons) Lifetime Oil Savings (gallons) Annual Propane Savings (gallons) Lifetime Propane Savings (gallons) Annual MMBtu Lifetime MMBtu Cost per Annual MMBtu Cost per lifetime MMBtu HES Income Eligible $3,516 $3,516 2,599 Homes 348,862 6,436,299 3,006 $10.08 $ , ,295 $97.94 $5.31 Home Energy Solutions (Notes 1 & 2) $6,119 $5,700 7,819 Homes/Other 789,904 15,044,883 7,672 $7.22 $ , ,812 3,573 58,852 87,933 1,661,948 $69.59 $3.68 Residential New Construction $770 $770 1,120 Homes 119,906 2,572, $6.42 $ , ,667 $62.41 $2.91 Water Heating (Note 3) $348 $348 1,792 Units 69,721 1,091, $4.99 $ , ,311 $48.45 $3.09 Subtotal Residential $10,753 $10,333 1,328,392 25,144,716 11,880 $7.78 $ , ,812 3,573 58, ,344 2,701,221 $75.01 $3.98 COMMERCIAL & INDUSTRIAL Energy Conscious Blue Print $3,059 $3, Projects 488,459 7,502,711 3,855 $6.26 $ , ,029 $60.86 $3.96 Energy Opportunities $1,586 $1, Projects 414,385 4,664,741 4,760 $3.83 $ , ,002 $37.20 $3.30 Operations & Maintenance $609 $ Projects 243,370 1,644,192 2,845 $2.50 $ , ,187 $24.32 $3.60 Small Business $231 $ Projects 51, , $4.46 $ ,321 59,897 $43.35 $3.85 Subtotal C&I $5,485 $5,485 1,197,924 14,393,737 12,053 $4.58 $ ,266 $ 1,481,116 $44.50 $3.70 Other Other $2,583 $2,583 TOTAL C&LM BUDGET $18,821 $18,402 2,526,316 39,538,454 23,933 $7.28 $ , ,812 3,573 58, ,610 4,182,337 $70.59 $4.50 Note 1: Homes Energy Solutions # of units includes 1081 homes that receive HES Core Services plus 6738 equipment rebates. Note 2: Home Energy Solutions includes oil and propane savings allocated to HES based on estimated Yankee Gas cost share for oil and propane measures. Note 3: Water heating # of units includes 1254 storage water heaters and 538 tankless units. 82

89 Table B Yankee Gas Comparison of Program Benefits Table B-2 Benefits Table, Yankee 2014 Program a b c = b - a Total Resource Cost Budget Program Costs Customer Cost Gas Benefit Gas DRIPE Program Benefits and Benefit/Cost Ratios Gas Benefit (Note2) Fossil Fuel Other Benefits Gas Cross- Fuel DRIPE Oil/Propane Water Non Resource Benefit Benefit/Cost HES Income Eligible $3,515,825 $4,063,756 $547,931 $2,921,711 $31,145 $870,819 $0 $78,916 $0 $3,902,592 Utility Benefit Cost Test $3,515,825 n/a n/a Total Resource Benefit Cost Test n/a $4,063,756 n/a Home Energy Solutions (HES) (Note 1) $6,119,355 $7,191,808 $1,072,453 $6,920,111 $73,653 $2,153,076 $2,055,744 $188,058 $0 $11,390,641 Utility Benefit Cost Test $6,119,355 n/a n/a Total Resource Benefit Cost Test n/a $7,191,808 n/a Residential New Construction $770,000 $1,109,592 $339,592 $1,130,822 $12,025 $292,810 $0 $0 $0 $1,435,657 Utility Benefit Cost Test $770,000 n/a n/a Total Resource Benefit Cost Test n/a $1,109,592 n/a Water Heating $347,587 $1,850,161 $1,502,575 $506,127 $5,591 $107,223 $0 $0 $0 $618,940 Utility Benefit Cost Test $347,587 n/a n/a Total Resource Benefit Cost Test n/a $1,850,161 n/a Sub Total Residential $10,752,767 $14,215,318 $3,462,551 $11,478,771 $122,413 $3,423,928 $2,055,744 $266,974 $0 $17,347,830 Utility Benefit Cost Test $10,752,767 n/a n/a Total Resource Benefit Cost Test n/a $14,215,318 n/a Energy Conscious Blueprint $3,059,208 $4,167,475 $1,108,267 $3,622,923 $40,191 $1,263,619 $0 $0 $0 $4,926,734 Utility Benefit Cost Test $3,059,208 n/a n/a Total Resource Benefit Cost Test n/a $4,167,475 n/a Energy Opportunities $1,586,356 $3,179,105 $1,592,749 $2,328,559 $26,702 $1,016,850 $0 $0 $0 $3,372,110 Utility Benefit Cost Test $1,586,356 n/a n/a Total Resource Benefit Cost Test n/a $3,179,105 n/a Business & Energy Sustainability $609,074 $1,413,101 $804,027 $861,250 $10,091 $566,481 $0 $0 $0 $1,437,822 Utility Benefit Cost Test $609,074 n/a n/a Total Resource Benefit Cost Test n/a $1,413,101 n/a Small Business $230,662 $430,377 $199,715 $280,950 $3,198 $138,575 $0 $0 $0 $422,723 Utility Benefit Cost Test $230,662 n/a n/a Total Resource Benefit Cost Test n/a $430,377 n/a Sub Total C&I $5,485,299 $9,190,058 $3,704,758 $7,093,683 $80,181 $2,985,526 $0 $0 $0 $10,159,390 Utility Benefit Cost Test $5,485,299 n/a n/a Total Resource Benefit Cost Test n/a $9,190,058 n/a Other Costs $2,582,792 $2,582,792 $ Total $18,820,859 $25,988,168 $7,167,309 $18,572,453 $202,594 $6,409,454 $2,055,744 $266,974 $0 $27,507,220 Utility Benefit Cost Test $18,820,859 n/a n/a Total Resource Benefit Cost Test n/a $25,988,168 n/a Note 1: Home Energy Solutions includes oil and propane benefits allocated to HES based on estimated Yankee Gas cost share for oil and propane measures. Note 2: CL&P used a discount rate of 7.52% and YGS used 7% for screening the benefits, based upon the Companies weighted after tax average cost of capital, and no less than minimum rate of 7% stated in Docket , DPUC Review of The Connecticut Gas Utilities Forecasts of Demand and Supply and Joint Conservation Plans and , DPUC Review of The Connecticut Energy Efficiency Fund's 2010 Conservation and Load Management Plan for

90 Table B Yankee Gas Comparison of Programs Energy Savings TABLE B-1, Energy Savings Yankee Gas 2015 Utility Costs Gas Costs # of Units Units Program (000) (000) Annualized Savings (ccf) Lifetime Savings (ccf) Peak Savings (ccf) Cost Rate $/ccf Annualize Utility Cost Ratio $/LT-ccf Annual Oil Savings (gallons) Lifetime Oil Savings (gallons) Annual Propane Savings (gallons) Lifetime Propane Savings (gallons) Annual MMBtu Lifetime MMBtu Cost per Annual MMBtu Cost per lifetime MMBtu RESIDENTIAL HES Income Eligible $3,230 $3,230 2,437 Homes 327,187 6,401,192 2,819 $9.87 $ , ,683 $95.94 $4.90 Home Energy Solutions $5,452 $5,024 7,892 Homes/Rebates 797,474 15,194,661 7,743 $6.30 $ , ,272 4,481 73,810 90,403 1,706,087 $60.31 $3.20 Residential New Construction $881 $ Homes 107,187 2,679, $8.22 $ , ,740 $79.89 $3.20 Water Heating $349 $349 1,629 Units 60,016 1,079, $5.81 $ , ,082 $56.44 $3.14 Subtotal Residential $9,912 $9,483 1,291,864 25,355,054 11,689 $7.34 $ , ,272 4,481 73, ,276 2,751,591 $70.16 $3.60 COMMERCIAL & INDUSTRIAL Energy Conscious Blue Print $3,592 $3, Projects 589,119 9,048,835 4,649 $6.10 $ , ,125 $59.25 $3.86 Energy Opportunities $1,995 $1, Projects 531,411 5,982,101 6,104 $3.75 $ , ,558 $36.48 $3.24 Operations & Maintenance $574 $ Projects 233,594 1,554,307 2,731 $2.46 $ , ,938 $23.88 $3.59 Small Business $270 $ Projects 64, , $4.19 $ ,626 74,584 $40.72 $3.62 Subtotal C&I $6,431 $6,431 1,418,512 17,310,062 14,223 $4.53 $ ,965 $ 1,781,205 $44.06 $3.61 Other Other $2,581 $2,581 TOTAL C&LM BUDGET $18,923 18,494 2,710,376 42,665,115 25,912 $6.82 $ , ,272 4,481 73, ,241 4,532,797 $65.88 $4.17 Note 1: Homes Energy Solutions # of units includes 1154 homes that receive HES Core Services plus 6738 equipment rebates. Note 2: Home Energy Solutions includes oil and propane savings allocated to HES based on estimated Yankee Gas cost share for oil and propane measures. Note 3: Water heating # of units includes 977 storage water heaters and 652 tankless units. 84

91 Table B Yankee Gas Comparison of Program Benefits Table B-2 Benefits Table, Yankee 2015 Program a b c = b - a Budget Program Costs Gas Benefit Note 2 Total Resource Cost Customer Cost Gas Benefit Gas DRIPE Program Benefits and Benefit/Cost Ratios Fossil Fuel Other Benefits Gas Cross-Fuel DRIPE Oil/Propane Water Non Resource Benefit Benefit/Cost HES Income Eligible $3,229,906 $4,521,828 $1,291,922 $2,997,786 $32,522 $542,989 $0 $75,493 $0 $3,648,790 Utility Benefit Cost Test $3,229,906 n/a n/a Total Resource Benefit Cost Test n/a $4,521,828 n/a Home Energy Solutions (HES) $5,452,495 $6,531,212 $1,078,717 $7,274,221 $78,948 $1,441,398 $3,170,873 $201,929 $0 $12,167,370 Utility Benefit Cost Test $5,452,495 n/a n/a Total Resource Benefit Cost Test n/a $6,531,212 n/a Residential New Construction $881,119 $1,066,463 $185,344 $1,167,002 $12,501 $181,192 $0 $0 $0 $1,360,695 Utility Benefit Cost Test $881,119 n/a n/a Total Resource Benefit Cost Test n/a $1,066,463 n/a Water Heating $348,524 $2,057,824 $1,709,300 $509,703 $5,690 $62,474 $0 $0 $0 $577,867 Utility Benefit Cost Test $348,524 n/a n/a Total Resource Benefit Cost Test n/a $2,057,824 n/a Sub Total Residential $9,912,044 $14,177,327 $4,265,283 $11,948,712 $129,661 $2,228,054 $3,170,873 $277,423 $0 $17,754,722 Utility Benefit Cost Test $9,912,044 n/a n/a Total Resource Benefit Cost Test n/a $14,177,327 n/a Energy Conscious Blueprint $3,591,970 $4,889,495 $1,297,524 $4,564,765 $51,725 $1,012,226 $0 $0 $0 $5,628,715 Utility Benefit Cost Test $3,591,970 n/a n/a Total Resource Benefit Cost Test n/a $4,889,495 n/a Energy Opportunities $1,994,840 $4,095,932 $2,101,092 $3,134,489 $36,986 $867,420 $0 $0 $0 $4,038,895 Utility Benefit Cost Test $1,994,840 n/a n/a Total Resource Benefit Cost Test n/a $4,095,932 n/a Business & Energy Sustainability $574,003 $1,539,080 $965,077 $870,951 $10,784 $364,288 $0 $0 $0 $1,246,022 Utility Benefit Cost Test $574,003 n/a n/a Total Resource Benefit Cost Test n/a $1,539,080 n/a Small Business $269,823 $523,831 $254,008 $367,312 $4,311 $114,511 $0 $0 $0 $486,133 Utility Benefit Cost Test $269,823 n/a n/a Total Resource Benefit Cost Test n/a $523,831 n/a Sub Total C&I $6,430,636 $11,048,338 $4,617,702 $8,937,516 $103,806 $2,358,444 $0 $0 $0 $11,399,765 Utility Benefit Cost Test $6,430,636 n/a n/a Total Resource Benefit Cost Test n/a $11,048,338 n/a Other Costs $2,580,712 $2,580,712 $ Total $18,923,393 $27,806,377 $8,882,984 $20,886,228 $233,466 $4,586,497 $3,170,873 $277,423 $0 $29,154,487 Utility Benefit Cost Test $18,923,393 n/a n/a Total Resource Benefit Cost Test n/a $27,806,377 n/a Note 1: Home Energy Solutions includes oil and propane benefits allocated to HES based on estimated Yankee Gas cost share for oil and propane measures. Note 2: CL&P used a discount rate of 7.52% and YGS used 7% for screening the benefits, based upon the Companies weighted after tax average cost of capital, and no less than minimum rate of 7% stated in Docket , DPUC Review of The Connecticut Gas Utilities Forecasts of Demand and Supply and Joint Conservation Plans and , DPUC Review of The Connecticut Energy Efficiency Fund's 2010 Conservation and Load Management Plan for

92 Table C 2014 Yankee Gas Program Budget by Category Table C YGS 2014 Budget Details GAS CONSERVATION BUDGET Labor Materials & Supplies Outside Services Incentives Marketing RESIDENTIAL Administrative Expenses TOTAL HES Income Eligible $ 224,550 $ 5,000 $ 140,674 $ 3,029,401 $ 100,903 $ 15,297 $ 3,515,825 Home Energy Solutions (HES) $ 255,000 $ 10,000 $ 342,170 $ 5,342,063 $ 150,014 $ 20,107 $ 6,119,355 Residential New Construction $ 35,000 $ 500 $ 40,271 $ 672,602 $ 18,162 $ 3,465 $ 770,000 Water Heating $ 15,000 $ 500 $ 5,000 $ 301,087 $ 25,000 $ 1,000 $ 347,587 Subtotal Residential $ 529,550 $ 16,000 $ 528,115 $ 9,345,153 $ 294,079 $ 39,870 $ 10,752,767 COMMERCIAL & INDUSTRIAL LOST OPPORTUNITY Energy Conscious Blueprint $ 190,000 $ 5,000 $ 156,021 $ 2,641,072 $ 55,413 $ 11,702 $ 3,059,208 Subtotal C&I - Lost Opportunity $ 190,000 $ 5,000 $ 156,021 $ 2,641,072 $ 55,413 $ 11,702 $ 3,059,208 COMMERCIAL & INDUSTRIAL LARGE RETROFIT Energy Opportunities $ 163,000 $ 1,000 $ 150,000 $ 1,228,973 $ 38,713 $ 4,670 $ 1,586,356 Business & Energy Sustainability (O&M, RetroCx, BSC) $ 55,000 $ 2,000 $ 50,000 $ 473,466 $ 19,625 $ 8,983 $ 609,074 Subtotal C&I - Retrofit $ 218,000 $ 3,000 $ 200,000 $ 1,702,439 $ 58,338 $ 13,653 $ 2,195,430 Small Business $ 15,000 $ 1,000 $ 10,000 $ 172,140 $ 10,522 $ 22,000 $ 230,662 Subtotal C&I $ 423,000 $ 9,000 $ 366,021 $ 4,515,651 $ 124,272 $ 47,355 $ 5,485,299 OTHER - EDUCATION SmartLiving Center - Museum Partnerships $ 7,655 $ 2,000 $ 158,178 $ - $ 5,000 $ 500 $ 173,333 Clean Energy Communities $ 14,000 $ - $ 129,333 $ - $ - $ - $ 143,333 EESmarts/K-12 $ 4,176 $ 1,300 $ 49,015 $ - $ 7,000 $ 5,176 $ 66,667 Customer Engagement $ - $ - $ 50,000 $ - $ - $ - $ 50,000 Subtotal Education $ 21,655 $ 2,000 $ 287,511 $ - $ 5,000 $ 500 $ 433,333 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy $ - $ - $ 37,333 $ - $ - $ - $ 37,333 ESPC Project Manager - Lead By Example $ 9,600 $ 9,600 Residential Financing (includes ECLF) $ - $ - $ 118,910 $ - $ - $ - $ 118,910 C&LM Loan Defaults $ - $ - $ 79,667 $ - $ - $ - $ 79,667 C&I Loan Program $ 89,000 $ 89,000 Subtotal Programs/Requirements $ - $ - $ 334,510 $ - $ - $ - $ 334,510 OTHER - RD&D Research, Development and Demonstration $ 29,500 $ - $ 29,500 $ - $ - $ - $ 59,000 Subtotal Renewables & RD&D $ 29,500 $ - $ 29,500 $ - $ - $ - $ 59,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 107,298 $ - $ - $ - $ - $ 11,922 $ 119,220 Marketing Plan $ - $ - $ - $ - $ 203,333 $ - $ 203,333 Information Technology $ 4,920 $ - $ 128,413 $ - $ - $ - $ 133,333 Planning $ 80,000 $ - $ - $ - $ - $ - $ 80,000 Evaluation $ - $ - $ 252,873 $ - $ - $ - $ 252,873 Evaluation Consultant $ - $ - $ 24,297 $ - $ - $ - $ 24,297 Energy Efficiency Board $ - $ - $ 50,210 $ - $ - $ - $ 50,210 Performance Fee $ - $ - $ - $ - $ - $ 892,683 $ 892,683 Subtotal Other $ 192,218 $ - $ 455,793 $ - $ 203,333 $ 904,605 $ 1,755,948 PROGRAM SUBTOTALS Residential $ 551,050 $ 18,900 $ 966,049 $ 9,345,153 $ 467,746 $ 45,446 $ 11,394,344 C&I $ 427,331 $ 9,400 $ 611,790 $ 4,515,651 $ 165,939 $ 47,455 $ 5,777,566 Other $ 221,718 $ - $ 522,626 $ - $ - $ 904,605 $ 1,648,949 TOTAL BUDGET $ 1,200,099 $ 28,300 $ 2,100,466 $ 13,860,804 $ 633,685 $ 997,505 $ 18,820,858 86

93 Table C 2014 Pie YGS 2014 Gas Conservation Budget By Expense Class Marketing 3.4% Administrative Expenses 5.3% Labor 6.4% Materials & Supplies 0.2% Outside Services 11.2% Incentives 73.6% Expense Classes Budget % of Budget Labor $ 1,200, % Materials & Supplies $ 28, % Outside Services $ 2,100, % Incentives $ 13,860, % Marketing $ 633, % Administrative Expenses $ 997, % Total $ 18,820, % 87

94 Table C 2015 Yankee Gas Program Budget by Category Table C YGS 2015 Budget Details GAS CONSERVATION BUDGET Labor Materials & Supplies Outside Services Incentives Marketing RESIDENTIAL Administrative Expenses TOTAL HES Income Eligible $ 254,550 $ 1,712 $ 71,757 $ 2,841,182 $ 52,101 $ 8,605 $ 3,229,906 Home Energy Solutions (HES) $ 345,270 $ 2,443 $ 160,720 $ 4,831,705 $ 101,855 $ 10,502 $ 5,452,495 Residential New Construction $ 24,024 $ 470 $ 49,110 $ 793,337 $ 9,953 $ 4,226 $ 881,119 Water Heating $ 8,853 $ 484 $ 2,231 $ 333,879 $ 2,162 $ 915 $ 348,524 Subtotal Residential $ 632,697 $ 5,108 $ 283,817 $ 8,800,103 $ 166,071 $ 24,248 $ 9,912,044 COMMERCIAL & INDUSTRIAL LOST OPPORTUNITY Energy Conscious Blueprint $ 221,517 $ 6,185 $ 190,317 $ 3,092,084 $ 67,593 $ 14,274 $ 3,591,970 Subtotal C&I - Lost Opportunity $ 221,517 $ 6,185 $ 190,317 $ 3,092,084 $ 67,593 $ 14,274 $ 3,591,970 COMMERCIAL & INDUSTRIAL LARGE RETROFIT Energy Opportunities $ 167,859 $ 912 $ 151,929 $ 1,621,213 $ 47,229 $ 5,697 $ 1,994,840 Business & Energy Sustainability (O&M, RetroCx, BSC) $ 43,980 $ 2,165 $ 17,575 $ 479,557 $ 20,472 $ 10,254 $ 574,003 Subtotal C&I - Retrofit $ 211,839 $ 3,076 $ 169,505 $ 2,100,770 $ 67,701 $ 15,952 $ 2,568,843 Small Business $ 16,070 $ 1,135 $ 5,267 $ 218,938 $ 23,589 $ 4,825 $ 269,823 Subtotal C&I $ 449,426 $ 10,397 $ 365,088 $ 5,411,792 $ 158,884 $ 35,050 $ 6,430,636 OTHER - EDUCATION SmartLiving Center - Museum Partnerships $ 3,621 $ 946 $ 74,831 $ - $ 2,365 $ 237 $ 82,000 Clean Energy Communities $ 22,487 $ - $ 106,428 $ - $ - $ 14,419 $ 143,333 EESmarts/K-12 $ 4,176 $ 1,300 $ 49,015 $ - $ 7,000 $ 5,176 $ 66,667 Customer Engagement $ - $ - $ 50,000 $ - $ - $ - $ 50,000 Subtotal Education $ 26,108 $ 946 $ 181,259 $ - $ 2,365 $ 14,655 $ 342,000 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy $ - $ - $ 37,333 $ - $ - $ - $ 37,333 ESPC Project Manager - Lead By Example $ - $ 9,600 $ - $ - $ - $ 9,600 Residential Financing (includes ECLF) $ - $ - $ 145,083 $ - $ - $ - $ 145,083 C&LM Loan Defaults $ - $ 86,333 $ 86,333 C&I Loan Program $ 109,000 $ 109,000 Subtotal Programs/Requirements $ - $ - $ 192,016 $ - $ - $ - $ 387,349 OTHER - RD&D Research, Development and Demonstration $ - $ - $ 72,000 $ - $ - $ - $ 72,000 Subtotal Renewables & RD&D $ - $ - $ 72,000 $ - $ - $ - $ 72,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 65,571 $ - $ - $ - $ - $ 53,649 $ 119,220 Marketing Plan $ - $ - $ - $ - $ 203,333 $ - $ 203,333 Information Technology $ 13,333 $ - $ 120,000 $ - $ - $ - $ 133,333 Planning $ 44,689 $ - $ - $ - $ - $ 35,311 $ 80,000 Evaluation $ - $ - $ 271,404 $ - $ - $ - $ 271,404 Evaluation Consultant $ - $ - $ 24,297 $ - $ - $ - $ 24,297 Energy Efficiency Board $ - $ - $ 50,210 $ - $ - $ - $ 50,210 Performance Fee $ - $ - $ - $ - $ - $ 897,566 $ 897,566 Subtotal Other $ 123, $ - $ 465,910 $ - $ 203,333 $ 986,526 $ 1,779,363 PROGRAM SUBTOTALS Residential $ 657,759 $ 7,165 $ 662,922 $ 8,800,103 $ 337,630 $ 41,148 $ 10,506,727 C&I $ 454,648 $ 10,586 $ 616,273 $ 5,411,792 $ 200,023 $ 37,981 $ 6,731,303 Other $ 123,593 $ - $ 575,244 $ - $ - $ 986,526 $ 1,685,363 TOTAL BUDGET $ 1,236,000 $ 17,751 $ 1,854,438 $ 14,211,895 $ 537,653 $ 1,065,655 $ 18,923,392 88

95 Table C 2015 Pie YGS 2015 Gas Conservation Budget By Expense Class Marketing 2.8% Administrative Expenses 5.6% Labor 6.5% Materials & Supplies 0.1% Outside Services 9.8% Incentives 75.1% Expense Classes Budget % of Budget Labor $ 1,236, % Materials & Supplies $ 17, % Outside Services $ 1,854, % Incentives $ 14,211, % Marketing $ 537, % Administrative Expenses $ 1,065, % Total $ 18,923, % 89

96 Table D1 YGS Historical and Projected Program Expenditures Table D1 YGS - Expenditure Natural Gas Conservation Plan Actual/Budget Natural Gas C&LM Actual/Budget Actual Actual Actual Actual Actual Actual Actual Actual Budget Budget RESIDENTIAL HES Income Eligible $404,449 $473,498 $712,801 $951,741 $1,054,952 $1,894,261 $1,683,995 $3,138,425 $3,515,825 $3,229,906 Home Energy Solutions (HES) $94,816 $510,401 $796,046 $515,716 $1,311,466 $1,197,146 $1,637,539 $1,724,523 $6,119,355 $5,452,495 Residential New Construction $314,517 $439,898 $769,583 $267,891 $193,667 $770,000 $881,119 Water Heating $62,859 $104,091 $60,847 $49,946 $55,706 $41,069 $347,587 $348,524 Subtotal Residential $499,265 $983,899 $1,571,706 $1,886,065 $2,867,163 $3,910,936 $3,645,131 $5,097,684 $10,752,767 $9,912,044 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint $390,328 $804,505 $1,001,519 $2,014,498 $1,247,518 $1,152,025 $3,059,208 $3,591,970 Total - Lost Opportunity $0 $0 $390,328 $804,505 $1,001,519 $2,014,498 $1,247,518 $1,152,025 $3,059,208 $3,591,970 C&I LARGE RETROFIT Energy Opportunities $49,283 $1,045,286 $491,898 $1,599,794 $1,133,274 $870,585 $1,586,356 $1,994,840 Business & Energy Sustainability (O&M, RetroCx, BSC) $8,249 $17,886 $123,338 $25,478 $55,381 $94,554 $609,074 $574,003 Process Retrofit Pilot $11,288 $60,880 Total - C&I Large Retrofit $0 $11,288 $118,412 $1,063,172 $615,236 $1,625,272 $1,188,655 $965,139 $2,195,430 $2,568,843 Small Business $65,653 $422,844 $230,662 $269,823 Subtotal C&I $0 $11,288 $508,740 $1,867,677 $1,616,755 $3,639,770 $2,501,826 $2,540,008 $5,485,299 $6,430,636 OTHER - Education SmartLiving Center -Museums Partnership $173,333 $82,000 Clean Energy Communities / Behavior Pilot $143,333 $143,333 EESmarts/K-12 $66,667 $66,667 Customer Engagement $50,000 $50,000 Subtotal Education $0 $0 $0 $0 $0 $0 $0 $0 $433,333 $342,000 OTHER - PROGRAMS/REQUIREMENTS Institute for Sustainable Energy $37,333 $37,333 ESPC Project Manager - Lead By Example $9,600 $9,600 Residential Financing (includes ECLF) $63,935 $35,438 $43,478 $55,386 $67,085 $66,744 $70,297 $70,112 $118,910 $145,083 C&LM Loan Defaults $79,667 $86,333 C&I Loan Program $294 $89,000 $109,000 Subtotal Programs/Requirements $63,935 $35,438 $43,478 $55,386 $67,085 $66,744 $70,297 $70,406 $287,577 $340,416 Subtotal RD&D $ - $ - $ - $ - $ - $ - $ - $ - $ 59,000 $ 72,000 OTHER - ADMINISTRATIVE & PLANNING Administration $51,486 $119,220 $119,220 Marketing Plan $8 $203,333 $203,333 Information Technology $28,126 $29,679 $36,337 $39,953 $51,196 $133,333 $133,333 Planning $4,526 $25,023 $100,679 $35,323 $34,581 $50,197 $67,396 $103,533 $80,000 $80,000 Evaluation $960 $48,155 $27,057 $257,425 $126,001 ($17,049) $252,873 $271,404 Evaluation Consultant $0 $24,297 $24,297 Energy Efficiency Board $7,551 $6,466 $3,070 $28,232 $13,905 $10,605 $18,161 $38,924 $50,210 $50,210 Performance Fee $605,725 $892,683 $897,566 Subtotal Other - Administrative & Planning $12,077 $31,489 $104,709 $139,836 $105,222 $354,564 $251,511 $833,824 $1,755,948 $1,779,363 PROGRAM SUBTOTALS Residential $563,200 $1,019,337 $1,615,184 $1,941,451 $2,934,248 $3,977,680 $3,715,428 $5,167,803 $11,394,344 $10,506,727 C&I $0 $11,288 $508,740 $1,867,677 $1,616,755 $3,639,770 $2,501,826 $2,540,303 $5,777,566 $6,731,303 Other $12,077 $31,489 $104,709 $139,836 $105,222 $354,564 $251,511 $833,816 $1,648,949 $1,685,363 TOTAL $575,277 $1,062,114 $2,228,633 $3,948,964 $4,656,225 $7,972,014 $6,468,765 $8,541,922 $18,820,859 $18,923,392 Research, Development and Demonstration - 59,000 72,000 90

97 Table D2 YGS Historical and Projected Program Units Table D2 YGS - Units Natural Gas Conservation Plan Actual/Budget Natural Gas C&LM Actual/Budget Actual Actual Actual Actual Actual Actual Actual Actual Budget Budget RESIDENTIAL HES Income Eligible - Weatherization 574 1,238 1,350 1,932 2,497 2,347 1,579 2,052 2,599 2,437 Home Energy Solutions (HES) 393 1,351 1, ,768 1,811 3,918 2,869 7,819 7,892 Insulation Rebate HES Early Retirement Furnace Rebate Res High Eff Natural Gas Furnace Replace Rebate Window Rebate Home Energy Solution (HES) - Total 393 1,351 1, ,768 1,811 3,918 3,507 7,819 7,892 Residential New Construction , Water Heating ,792 1,629 Subtotal Residential 967 2,589 3,334 3,359 5,650 4,521 5,965 6,247 13,329 12,545 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint Total - Lost Opportunity C&I LARGE RETROFIT Energy Opportunities Business & Energy Sustainability (O&M, RetroCx, BSC) Process Retrofit Pilot 1 Total - C&I Large Retrofit Small Business Subtotal C&I PROGRAM SUBTOTALS Residential 967 2,589 3,334 3,359 5,650 4,521 5,965 6,247 13,329 12,545 C&I Other TOTAL 967 2,589 3,351 3,408 5,745 4,649 6,132 6,479 13,467 12,708 91

98 Table D3 & D4 YGS Historical and Projected Annual and Lifetime CCF Table D3 YGS - Annual Savings (CCF) Natural Gas Conservation Plan Actual/Budget Natural Gas C&LM Actual/Budget Actual Actual Actual Actual Actual Actual Actual Actual Budget Budget RESIDENTIAL HES Income Eligible - Weatherization 45, ,407 94, , , , , , , ,187 Home Energy Solutions (HES) 11,295 86,333 98,698 55, , , , , , ,474 Insulation Rebate , HES Early Retirement Furnace Rebate , Res High Eff Natural Gas Furnace Replace Rebate , Window Rebate , Home Energy Solution (HES) - Total 11,295 86,333 98,698 55, , , , , , ,474 Residential New Construction 31,287 41,991 47,744 38,642 53, , ,187 Water Heating 9,728 18,422 10,883 7,168 6,129 2,812 69,721 60,016 Subtotal Residential 57, , , , , , , ,234 1,328,392 1,291,864 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 43, , , , , , , ,119 Total - Lost Opportunity , , , , , , , ,119 C&I LARGE RETROFIT Energy Opportunities 17, , , , , , , ,411 O&M (RetroCx, Training) 0 6,683 66,979 15,429 52,488 53, , ,594 Process Retrofit Pilot 27,997 Total - C&I Large Retrofit , , , , , , , ,005 Small Business 0 23,405 72,422 51,709 64,388 Subtotal C&I , , , , , ,076 1,197,924 1,418,512 PROGRAM SUBTOTALS Residential 57, , , , , , , ,234 1,328,392 1,291,864 C&I , , , , , ,076 1,197,924 1,418,512 Other TOTAL 57, , ,253 1,059,377 1,030,703 1,366,824 1,234,230 1,646,309 2,526,316 2,710,376 Table D4 YGS - Lifetime Savings (CCF) Natural Gas Conservation Plan Actual/Budget Natural Gas C&LM Actual/Budget Actual Actual Actual Actual Actual Actual Actual Actual Budget Budget RESIDENTIAL HES Income Eligible - Weatherization 941,555 1,396,219 1,617,301 3,534,308 2,616,614 6,081,081 3,750,072 6,590,419 6,436,299 6,401,192 Home Energy Solutions (HES) 213,599 1,324,880 1,770,065 1,172,933 4,768,051 3,118,836 4,870,250 4,136,193 15,044,883 15,194,661 Insulation Rebate 425, HES Early Retirement Furnace Rebate 35, Res High Eff Natural Gas Furnace Replace Rebate 829, Window Rebate 52, Home Energy Solution (HES) - Total 213,599 1,324,880 1,770,065 1,172,933 4,768,051 3,118,836 4,870,250 5,479,448 15,044,883 15,194,661 Residential New Construction 782,194 1,049,784 1,193, ,273 1,171,781 2,572,078 2,679,687 Water Heating 194, , , ,360 84,305 56,244 1,091,456 1,079,513 Subtotal Residential 1,155,154 2,721,099 3,581,926 5,857,883 8,652,113 10,536,886 9,656,900 13,297,892 25,144,716 25,355,054 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint 670,160 1,770,613 4,371,511 5,637,483 5,074,442 4,012,514 7,502,711 9,048,835 Total - Lost Opportunity ,160 1,770,613 4,371,511 5,637,483 5,074,442 4,012,514 7,502,711 9,048,835 C&I LARGE RETROFIT Energy Opportunities 191,374 9,216,030 2,347,874 4,168,922 3,017,300 5,870,925 4,664,741 5,982,101 O&M (RetroCx, Training) 0 66, ,798 77, , ,693 1,644,192 1,554,307 Process Retrofit Pilot 559,940 Total - C&I Large Retrofit ,314 9,282,860 3,017,672 4,246,067 3,386,500 6,269,618 6,308,933 7,536,408 Small Business 0 290, , , ,819 Subtotal C&I 0 0 1,421,474 11,053,473 7,389,183 9,883,550 8,751,114 11,117,734 14,393,737 17,310,062 PROGRAM SUBTOTALS Residential 1,155,154 2,721,099 3,581,926 5,857,883 8,652,113 10,536,886 9,656,900 13,297,892 25,144,716 25,355,054 C&I 0 0 1,421,474 11,053,473 7,389,183 9,883,550 8,751,114 11,117,734 14,393,737 17,310,062 Other TOTAL 1,155,154 2,721,099 5,003,400 16,911,356 16,041,296 20,420,436 18,408,014 24,415,626 39,538,454 42,665,115 92

99 Incentive $ Earned YGS Performance Incentive 2014 Yankee Gas Service Company 2014 Management Incentive Performance Indicators and Incentive Matrix YGS and the EEB recognize that having clear indicators and metrics of performance are helpful in delivering quality programs to Connecticut consumers. The following is a table of performance and incentive metrics developed by the utilities with input from the EEB, the Board consultants and the Department. These performance and incentive metrics apply to the programs delineated in this Plan. The projected YGS Performance Incentive is $ 892,683 and is based on achieving 100% of all performance targets and earning an incentive of 5% of the total C&LM program budget of $ 17,853,669 as shown on Table A (exclusive of Energy Efficiency Board costs, Evaluation Consultant costs, management incentives and audit costs). The actual earned amount will be calculated on a sliding scale based on the percent of goal achieved and the actual total expenditures, based on the following performance range: -Performance Incentive Illustration- Performance % Minimum Pretax Incentive Pre-tax Incentive Incentive $ Earned vs Performance Achieved 1,600, % $446, % $535, % $714, % $892, % $1,071, % $1,249, % $1,428,294 Maximum 1,400,000 1,200,000 1,000, , , ,000 Incentive Basis Budget $17,853,669 Goals will be prorated based on actual over/under spend of budget in the event actual spending is over/under 5% or more of budget. 200, Performance Achieved % of Target 93

100 HES Income Eligible 6,436, % $15,025,111 YGS Performance Incentive 2014 (cont.) Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive SECTOR Program RESIDENTIAL Program Name LT-CCF % (1) Gas System Benefit from Residential programs $10,752,767 $174, Sum of Gas System Benefit from Residential programs Residential Programs (Sector Level) Sector Budget Home Energy Solution 15,044, % Residential New Cons 2,572, % Water Heating 1,091, % Total 25,144,716 Savings Rate $ / CCF Savings $15,025,111 (1) percent of target goal $4,272,344 $4,272, $174,073 Net Residential Gas Benefit : Net Residential Gas Benefit : Water Heating - Number of Water Heating Units (tankless & Water Heating $347,587 Number of Units $8,927 condensing units) per DEEP Final Decision Achieve CCF savings per single family home as per DEEP Final Home Energy Solutions $6,119,355 CCF/home $44,634 Decision HES Income Eligible $3,515,825 Annual CCF savings Annual CCF Savings K $26,781 94

101 YGS Performance Incentive 2014 (cont.) SECTOR Program COMMERCIAL & INDUSTRIAL (C&I) $5,485,299 C&I Programs (Sector Level) Sector Budget Net C&I Gas System Benefit: Small Business $230,662 Performance Indicators Incentive Metrics Incentive Metric Target Goal Weight Incentive Program Name LT-CCF % (1) Energy Conscious Blueprint 7,502,711 Energy Opportunities 4,664, % Total Gas System Benefit from C&I programs Gas System Benefit from C&I programs 32.4% O&M 1,644, % $10,159,390 Small Business 582, % Total 14,393, $187,464 Savings Rate $ / CCF Savings $10,159,390 (1) percent of target goal Net C&I Gas System Benefit: $4,674,090 $4,674, $187,464 SBEA - Number of gas projects that are comprehensive or implement measure bundles or Number of projects that consist of at least two gas measures Comprehensive is defined as 1. More than one End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, and involves an End Use with a natural gas measure. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings Only SBEA projects are eligible Calculations based on signed projects with gas, no Rebates: [ (# of signed projects with gas - any rebate projects) / (total # of signed SBEA projects with gas - any rebate projects)] % of Gas Projects 10% of signed projects $26,781 Small Business projects may also be comprehensive by utilizing bundled measures. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Energy Star Natural Gas or Electric Dishwashers. 95

102 YGS Performance Incentive 2014 (cont.) SECTOR Program Energy Consumptions Blueprint /Energy Opportunities Manufacturing /Segmentation Total Incentive $ Residential and C&I Performance Indicators EO - Percentage of signed gas only projects containing multiple measures Projects must fall within Energy Opportunities or Energy Conscious Blueprint programming; Projects must contain multiple gas measures; No restriction to the number of enduses; No SBEA projects are included, Calculations based on signed projects, no Rebates: [ (# of signed projects - rebate projects) / (total # of signed projects from all large C&I - all rebate projects)] Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the gas energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] Incentive Metrics Incentive Metric Target Goal Weight Incentive % of Gas Projects 15% of signed projects $26,781 % of Savings Via Signed Contracts 20% of savings via signed contracts $35, $892,683 96

103 Incentive $ Earned YGS Performance Incentive 2015 Yankee Gas Service Company 2015 Management Incentive Performance Indicators and Incentive Matrix YGS and the EEB recognize that having clear indicators and metrics of performance are helpful in delivering quality programs to Connecticut consumers. The following is a table of performance and incentive metrics developed by the utilities with input from the EEB, the Board consultants and the Department. These performance and incentive metrics apply to the programs delineated in this Plan. The projected YGS Performance Incentive is $ 897,566 and is based on achieving 100% of all performance targets and earning an incentive of 5% of the total C&LM program budget of $ 17,951,320 as shown on Table A (exclusive of Energy Efficiency Board costs, Evaluation Consultant costs, management incentives and audit costs). The actual earned amount will be calculated on a sliding scale based on the percent of goal achieved and the actual total expenditures, based on the following performance range: -Performance Incentive Illustration- Performance % Pretax Incentive Pre-tax Incentive Minimum 80 3% $538, % $718, % $897, % $1,077, % $1,256, % $1,436,106 Maximum Incentive Basis Budget $17,951,320 Goals will be prorated based on actual over/under spend of budget in the event actual spending is over/under 5% or more of budget. 1,600,000 1,400,000 1,200,000 1,000, , , , ,000 0 Incentive $ Earned vs Performance Achieved Performance Achieved % of Target 97

104 YGS Performance Incentive 2015 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive RESIDENTIAL Residential Programs (Sector Level) Sector Budget $9,912,044 Program Name LT-CCF % (1) HES Income Eligible 6,401, % $14,306,426 Home Energy Solution 15,194, % Residential New Cons 2,679, % Water Heating 1,079, % Sum of Gas System Benefit from Residential programs Gas System Benefit from Residential programs $175,025 Total 25,355,054 Net Residential Gas Benefit : Savings Rate $ / CCF Savings $14,306,426 (1) percent of target goal Net Residential Gas Benefit : $4,394,382 $4,394, $175,025 Water Heating - Number of Water Heating Units (tankless & condensing Water Heating $348,524 Number of Units $8,976 units) per DEEP Final Decision Home Energy Solutions $5,452,495 Achieve CCF savings per single family home as per DEEP Final Decision CCF/home $44,878 HES Income Eligible $3,229,906 Annual CCF savings Annual CCF Savings K $26,

105 YGS Performance Incentive 2015 (cont.) SECTOR Program COMMERCIAL & INDUSTRIAL (C&I) $6,430,636 C&I Programs (Sector Level) Sector Budget Net C&I Gas System Benefit: Small Business $ 269,823 Performance Indicators Incentive Metrics Incentive Metric Target Goal Weight Incentive Program Name LT-CCF % (1) Energy Conscious Blueprint 9,048,835 Energy Opportunities 5,982, % Total Gas System Benefit from C&I programs Gas System Benefit from C&I programs 34.56% O&M 1,554, % $11,399,765 Small Business 724, % Total 17,310, $188,489 Savings Rate $ / CCF (1) percent of target goal Net C&I Gas System Benefit: $4,969,129 $4,969, $188,489 SBEA - Number of gas projects that are comprehensive or implement measure bundles or Number of projects that consist of at least two gas measures Comprehensive is defined as 1. More than one End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, and involves an End Use with a natural gas measure. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings Only SBEA projects are eligible Calculations based on signed projects with gas, no Rebates: [ (# of signed projects with gas - any rebate projects) / (total # of signed SBEA projects with gas - any rebate projects)] % of Gas Projects 12% of signed projects $26,927 Small Business projects may also be comprehensive by utilizing bundled measures. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Energy Star Natural Gas or Electric Dishwashers. Savings $11,399,765 99

106 YGS Performance Incentive 2015 (cont.) SECTOR Program Energy Conscious Blueprint /Energy Opportunities Manufacturing /Segmentation Total Incentive $ Residential and C&I Performance Indicators Incentive Metrics Incentive Metric Target Goal Weight Incentive EO - Percentage of signed gas only projects containing multiple measures Projects must fall within Energy Opportunities or Energy Conscious Blueprint programming; Projects must contain multiple gas measures; $574,003 No restriction to the number of enduses; % of Gas Projects 17% of signed projects $26,927 No SBEA projects are included, Calculations based on signed projects, no Rebates: [ (# of signed projects - rebate projects) / (total # of signed projects from all large C&I - all rebate projects)] Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the gas energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] % of Savings Via Signed Contracts 22% of savings via signed contracts $35, $897,

107 The Connecticut Natural Gas Corporation Budget Tables 101

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109 Table A CNG 2013 Actual Results, Budget Table A CNG Proposed Natural Gas Conservation Plan Budget CNG CNG CNG Natural Gas C&LM Budget Actual Approved Approved Expenditures Budget Budget RESIDENTIAL HES Income Eligible $ 903,813 $ 2,744,857 $ 2,721,693 Home Energy Solutions (HES) $ 2,013,801 $ 4,471,024 $ 4,742,979 Residential New Construction $ 1,374,360 $ 446,750 $ 425,376 Water Heating $ 21,861 $ 300,238 $ 307,471 Subtotal Residential $ 4,313,835 $ 7,962,869 $ 8,197,519 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint $ 1,177,206 $ 1,957,423 $ 1,987,642 Total - Lost Opportunity $ 1,177,206 $ 1,957,423 $ 1,987,642 C&I LARGE RETROFIT Energy Opportunities $ 1,536,144 $ 1,025,782 $ 1,039,762 O&M (RetroCx, Training) $ 89,673 $ 574,201 $ 707,186 Total - C&I Large Retrofit $ 1,625,817 $ 1,599,983 $ 1,746,948 Small Business $ 210,560 $ 160,008 $ 166,030 Subtotal C&I $ 3,013,583 $ 3,717,414 $ 3,900,620 OTHER - Education SmartLiving Center -Museums Partnership $ 173,333 $ 82,000 EE Communities $ 5,888 $ 143,333 $ 143,333 EESmarts/K-12 $ 66,667 $ 66,667 Customer Engagement $ 50,000 $ 50,000 Subtotal Education $ 5,888 $ 433,333 $ 342,000 OTHER - PROGRAMS/REQUIREMENTS ISE $ 37,333 $ 37,333 ESPC $ 9,600 $ 9,600 Resi Financing/CHIF Loan Fund $ 56,061 $ 100,045 $ 99,959 C&LM Loan Defaults $ 79,667 $ 86,333 C&I Financing Subsidies $ 17,603 $ 75,000 $ 75,000 Subtotal Programs/Requirements $ 73,664 $ 301,645 $ 308,225 Research, Development and Demonstration $ 79,200 $ 50,000 $ 50,000 Subtotal RD&D $ 79,200 $ 50,000 $ 50,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 89,999 $ 121,329 $ 121,329 Marketing Plan $ 203,333 $ 203,333 Information Technology $ 49,237 $ 133,333 $ 133,333 Planning $ 144,735 $ 80,000 $ 80,000 Evaluation $ 35,671 $ 228,883 $ 245,717 Evaluation Consultant $ 24,297 $ 24,297 Energy Efficiency Board $ 43,079 $ 50,210 $ 50,210 Performance Fee $ 601,048 $ 661,607 $ 679,104 Subtotal Other - Administrative & Planning $ 963,769 $ 1,502,992 $ 1,537,323 PROGRAM SUBTOTALS Residential $ 4,374,606 $ 8,409,580 $ 8,571,078 C&I $ 3,032,364 $ 4,005,681 $ 4,177,286 Other $ 1,042,969 $ 1,552,992 $ 1,587,323 TOTAL $ 8,449,939 $ 13,968,253 $ 14,335,

110 Table A 2014 Pie CNG 2014 Budget Analysis Budget By Customer Class Res. Income Eligible 18.87% Commercial and Industrial 36.63% Res. Non Income Eligible 44.49% % of Total % of Customer Class Budget Conservation Residential & Budget C&I Budget Res. Income Eligible $2,744, % 18.87% Res. Non Income Eligible $5,664, % 44.49% Residential Subtotal $8,409, % 63.37% Commercial and Industrial $4,005, % 36.63% C&I Subtotal $4,005, % 36.63% Residential and C&I Subtotal $12,415, % % Other Expenditures Other Expenditures $1,552, % Other Expenditures Subtotal $1,552, % TOTAL $13,968, % 104

111 Table A 2015 Pie CNG 2015 Budget Analysis Budget By Customer Class Res. Income Eligible 18.00% Commercial and Industrial 34.94% Res. Non Income Eligible 47.06% % of Total % of Customer Class Budget Conservation Residential & Budget C&I Budget Res. Income Eligible $2,721, % 18.00% Res. Non Income Eligible $5,849, % 47.06% Residential Subtotal $8,571, % 65.06% Commercial and Industrial $4,177, % 34.94% C&I Subtotal $4,177, % 34.94% Residential and C&I Subtotal $12,748, % % Other Expenditures Other Expenditures $1,587, % Other Expenditures Subtotal $1,587, % TOTAL $14,335, % 105

112 Table B 2014 CNG Comparison of Program Energy Savings Table B 2014 COMPARISON OF CONSERVATION PROGRAMS RESIDENTIAL Program Program Costs 2014 Customer Cost 2014 Total Resource Cost 2014 Program Benefit (Gas & Oil) Total Resource Benefit % of 2014 Budget Program B/C Ratio Total Resource B/C Ratio Goals/ # Units Units of Measure Annualized Savings (ccf) CNG HES Income Eligible $ 2,744,857 $ - $ 2,744,857 $ 5,383,952 $ 6,202, % ,124 Homes 341,437 6,706,839 2,985 SCG HES Income Eligible $ 2,680,076 $ - $ 2,680,076 $ 5,325,359 $ 6,135, % ,080 Homes 337,721 6,633,849 2,953 Lifetime Savings (ccf) Peak Day Savings (ccf) CNG Home Energy Solutions $ 4,471,024 $ 2,218,939 $ 6,689,963 $ 13,313,088 $ 14,008, % ,553 SCG Home Energy Solutions $ 2,545,354 $ 1,006,537 $ 3,551,891 $ 6,141,533 $ 6,473, % ,402 Homes & HVAC Rebated 619,313 12,358,649 5,529 Homes & HVAC Rebated 383,859 7,658,261 3,489 SCG Residential Behavior $ 541,800 $ 412,268 $ 954,068 $ 1,337,714 $ 1,337, % ,500 Thermostats 145,424 1,454,241 1,421 CNG New Construction $ 446,750 $ 1,085,424 $ 1,409,481 $ 1,078,969 $ 1,078, % Homes 55,291 1,382, SCG New Construction $ 351,535 $ 774,564 $ 1,008,403 $ 770,921 $ 770, % Homes 39, , CNG Water Heating $ 300,238 $ 897,040 $ 1,173,040 $ 776,576 $ 776, % ,280 Units 73, , SCG Water Heating $ 300,238 $ 897,040 $ 1,173,040 $ 776,576 $ 776, % ,280 Units 73, , Subtotal Residential $ 14,381,872 $ 7,291,812 $ 21,384,820 $ 34,904,688 $ 37,560, % ,573 Homes/ Units 2,070,354 39,055,041 17,205 Commercial and Industrial C&I Lost CNG Energy Conscious Blueprint $ 1,957,423 $ 762,476 $ 2,719,899 $ 3,738,115 $ 3,738, % Projects 316,759 4,865,394 2,500 SCG Energy Conscious Blueprint $ 1,357,784 $ 541,872 $ 1,899,656 $ 2,656,583 $ 2,656, % Projects 225,112 3,457,711 1,776 Commercial and Industrial Large Retrofit YGS Energy Opportunities CNG Energy Opportunities $ 1,025,782 $ 1,494,908 $ 2,520,690 $ 2,773,147 $ 2,773, % Projects 294,351 3,316,691 3,365 SCG Energy Opportunities $ 628,862 $ 797,971 $ 1,426,833 $ 1,480,286 $ 1,480, % Projects 157,123 1,770,426 1,796 Sub Total Energy Opportunites $ 1,654,644 $ 2,292,880 $ 3,947,524 $ 4,253,434 $ 4,253, % Projects 451,474 5,087,117 5,162 CNG O&M $ 574,201 $ 915,630 $ 1,489,831 $ 1,653,016 $ 1,653, % Projects 231,618 1,852,948 2,550 SCG O&M $ 477,726 $ 771,064 $ 1,248,790 $ 1,392,028 $ 1,392, % Projects 195,049 1,560,393 2,147 CNG Small Business $ 160,008 $ 196,502 $ 356,510 $ 364,524 $ 364, % Projects 38, , SCG Small Business $ 124,329 $ 159,181 $ 283,510 $ 295,290 $ 295, % Projects 31, , Subtotal Commercial & Industrial $ 6,306,115 $ 5,639,605 $ 11,945,720 $ 14,352,989 $ 14,352, % Projects 1,490,047 17,612,701 14,936 OTHER CNG CHIF, Residential, C&I Loan Program $ 301, % SCG CHIF, Residential, C&I Loan Program $ 301, % Sub Total Other - Loan Program $ 603, % CNG IT, Planning, Evaluation, and EEB $ 1,986, % SCG IT, Planning, Evaluation, and EEB $ 1,852, % Sub Total Other - Evaluation $ 3,839, % Subtotal Other $ 4,442, % PROGRAM SUBTOTALS CNG Residential $ 7,962,869 $ 4,201,403 $ 12,017,341 $ 20,552,585 $ 22,066, % 1,089,944 21,384,436 8,958 SCG Residential $ 6,419,003 $ 3,090,409 $ 9,367,478 $ 14,352,103 $ 15,493, % 980,410 17,670,606 8,247 Residential Total $ 14,381,872 $ 7,291,812 $ 21,384,820 $ 34,904,688 37,560,716 CNG C&I $ 3,717,414 $ 3,369,516 $ 7,086,930 $ 8,528,803 $ 8,528, % 881,420 10,471,004 8,857 SCG C&I $ 2,588,701 $ 2,270,089 $ 4,858,790 $ 5,824,187 $ 5,824, % 608,627 7,141,697 6,079 C&I Total $ 6,306,115 $ 5,639,605 $ 11,945,720 $ 14,352,989 14,352,989 CNG Other $ 2,287, % SCG Other $ 2,154, % Other Total $ 4,442,311 $ - $ - $ - $ % CNG TOTAL $ 13,968,253 $ 7,570,919 $ 19,104,272 $ 29,081,387 $ 30,595, % 1,971,364 31,855,440 17,815 SCG TOTAL $ 11,162,045 $ 5,360,498 $ 14,226,268 $ 20,176,290 $ 21,318, % 1,589,037 24,812,303 14,326 GRAND TOTAL $ 25,130,298 $ 12,931,417 $ 33,330,540 $ 49,257,677 $ 51,913, % ,560,402 56,667,743 32,141 Sub Total HES Income Eligible $ 5,424,933 $ - $ 5,424,933 $ 10,709,311 $ 12,337, % ,204 Homes 679,158 13,340,688 5,938 Sub Total Home Energy Solutions $ 7,016,378 $ 3,225,476 $ 10,241,854 $ 19,454,621 $ 20,482, % ,956 Homes 1,003,173 20,016,911 9,018 Sub Total New Construction $ 798,285 $ 1,859,988 $ 2,417,884 $ 1,849,890 $ 1,849, % Homes 94,794 2,369, Sub Total Water Heating $ 600,476 $ 1,794,080 $ 2,346,080 $ 1,553,152 $ 1,553, % ,560 Units 147,805 1,873, Sub Total Lost Opportunity $ 3,315,207 $ 1,304,348 $ 4,619,555 $ 6,394,698 $ 6,394, % Projects 541,871 8,323,105 4,276 Sub Total O&M $ 1,051,927 $ 1,686,694 $ 2,738,621 $ 3,045,044 $ 3,045, % Projects 426,668 3,413,341 4,698 Sub Total Small Business $ 284,337 $ 355,683 $ 640,020 $ 659,813 $ 659, % Projects 70, , $ 57.2% 2,070,354 39,055,041 17,205 $ 25.1% 1,490,047 17,612,701 14,

113 Table B 2014 CNG Comparison of Program Energy Savings (cont.) Table B 2014 COMPARISON OF CONSERVATION PROGRAMS RESIDENTIAL Program Annual Cost Rate ($/ccf) Lifetime Cost Rate ($/ccf) Annualized Savings Oil (gallons) Lifetime Savings Oil (gallons) Annualized Savings Propane (gallons) Lifetime Savings Propane (gallons) Annual MMBTU Lifetime MMBTU Cost per Annual MMBTU Cost per Lifetime MMBTU CNG HES Income Eligible $ 8.04 $ , ,134 $ $ 3.98 SCG HES Income Eligible $ 7.94 $ , ,623 $ $ 3.93 CNG Home Energy Solutions $ 7.22 $ , ,152 2,761 55,217 70,367 1,404,502 $ $ 3.18 SCG Home Energy Solutions $ 6.63 $ , ,035 $ $ 3.23 Sub Total Home Energy Solutions $ 6.99 $ , ,152 2,761 55, ,866 2,192,538 $ $ 3.20 SCG Residential Behavior $ 6.56 $ , ,641 $ $ 6.38 CNG New Construction $ 8.08 $ , ,236 $ $ 3.14 SCG New Construction $ 8.90 $ , ,622 $ $ 3.46 Sub Total New Construction $ 8.42 $ , ,859 $ $ 3.27 CNG Water Heating $ 4.06 $ ,605 96,383 $ $ 3.12 SCG Water Heating $ 4.06 $ ,605 96,383 $ $ 3.12 Sub Total Water Heating $ 4.06 $ , ,767 $ $ 3.12 Subtotal Residential $ 6.95 $ , ,152 2,761 55, ,679 4,151,561 $ $ 3.46 Commercial and Industrial C&I Lost CNG Energy Conscious Blueprint $ 6.18 $ , ,649 $ $ 3.91 SCG Energy Conscious Blueprint $ 6.03 $ , ,798 $ $ 3.82 Sub Total Lost Opportunity $ 6.12 $ , ,448 $ $ 3.87 Commercial and Industrial Large Retrofit YGS Energy Opportunities CNG Energy Opportunities $ 3.48 $ , ,288 $ $ 3.01 SCG Energy Opportunities $ 4.00 $ , ,177 $ $ 3.45 Sub Total Energy Opportunites $ 3.66 $ , ,464 $ $ 3.16 CNG O&M $ 2.48 $ , ,668 $ $ 3.01 SCG O&M $ 2.45 $ , ,564 $ $ 2.98 Sub Total O&M $ 2.47 $ , ,233 $ $ 2.99 CNG Small Business $ 4.14 $ ,981 44,861 $ $ 3.57 SCG Small Business $ 3.97 $ ,225 36,341 $ $ 3.42 Sub Total Small Business $ 4.06 $ ,207 81,202 $ $ 3.50 Subtotal Commercial & Industrial $ 4.23 $ OTHER CNG CHIF, Residential, C&I Loan Program SCG CHIF, Residential, C&I Loan Program Sub Total Other - Loan Program CNG IT, Planning, Evaluation, and EEB SCG IT, Planning, Evaluation, and EEB Sub Total Other - Evaluation Subtotal Other PROGRAM SUBTOTALS CNG Residential $ 7.31 $ , ,152 2,761 55, ,795 2,333,256 $ $ 3.41 SCG Residential $ 6.55 $ ,884 1,818,305 $ $ 3.53 Residential Total $ 6.95 $ , ,152 2,761 55, ,679 4,151,561 $ $ 3.46 CNG C&I $ 4.22 $ ,698 1,077,466 $ $ 3.45 SCG C&I $ 4.25 $ , ,881 $ $ 3.52 C&I Total $ 4.23 $ ,326 1,812,347 $ $ 3.48 CNG Other 0 0 SCG Other 0 0 CNG TOTAL $ 7.09 $ , ,152 2,761 55, ,493 3,410,722 $ $ 4.10 SCG TOTAL $ 7.02 $ ,512 2,553,186 $ $ 4.37 GRAND TOTAL $ 7.06 $ , ,152 2,761 55, ,005 5,963,908 $ $ 4.21 Sub Total HES Income Eligible $ 7.99 $ ,885 1,372,757 $ $ 3.95 Other Total

114 Table B 2015 CNG Comparison of Programs Energy Savings Table B 2015 COMPARISON OF CONSERVATION PROGRAMS RESIDENTIAL Program Program Costs 2015 Customer Cost 2015 Total Resource Cost 2015 Program Benefit (Gas & Oil) Total Resource Benefit % of 2015 Budget Program B/C Ratio Total Resource B/C Ratio Goals/ # Units Units of Measure Annualized Savings (ccf) CNG HES Income Eligible $ 2,721,693 $ - $ 2,721,693 $ 5,184,996 $ 6,012, % ,085 Homes 338,182 6,642,905 2,957 SCG HES Income Eligible $ 2,554,642 $ - $ 2,554,642 $ 4,907,703 $ 5,690, % ,867 Homes 320,096 6,287,642 2,799 Lifetime Savings (ccf) Peak Day Savings (ccf) CNG Home Energy Solutions $ 4,742,979 $ 2,353,092 $ 7,096,071 $ 13,772,321 $ 14,545, % ,936 SCG Home Energy Solutions $ 2,711,657 $ 1,072,675 $ 3,784,332 $ 6,373,942 $ 6,753, % ,638 Homes & HVAC Rebated 661,144 13,194,092 49,973 Homes & HVAC Rebated 409,714 8,174,441 0 SCG Residential Behavior $ 451,800 $ 405,158 $ 856,958 $ 1,233,538 $ 1,233, % ,500 Thermostats 145,424 1,454,241 1,421 CNG New Construction $ 425,376 $ 351,484 $ 776,860 $ 993,674 $ 993, % Homes 51,687 1,292, SCG New Construction $ 330,790 $ 250,960 $ 581,750 $ 693,760 $ 693, % Homes 36, , CNG Water Heating $ 307,471 $ 897,040 $ 1,204,511 $ 737,170 $ 737, % ,280 Units 73, , SCG Water Heating $ 307,471 $ 897,040 $ 1,204,511 $ 737,170 $ 737, % ,280 Units 73, , Subtotal Residential $ 14,553,879 $ 6,227,449 $ 20,781,328 $ 34,634,275 $ 37,396, % ,913 Homes/ Units 2,255,566 41,275,296 59,815 Commercial and Industrial C&I Lost CNG Energy Conscious Blueprint $ 1,987,642 $ 769,883 $ 2,757,525 $ 3,629,348 $ 3,629, % Projects 319,835 4,912,656 2,524 SCG Energy Conscious Blueprint $ 1,336,803 $ 527,038 $ 1,863,841 $ 2,484,540 $ 2,484, % Projects 218,950 3,363,054 1,728 Commercial and Industrial Large Retrofit CNG Energy Opportunities $ 1,039,762 $ 1,489,861 $ 2,529,623 $ 2,603,769 $ 2,603, % Projects 293,357 3,305,492 3,354 SCG Energy Opportunities $ 620,398 $ 800,770 $ 1,421,168 $ 1,399,474 $ 1,399, % Projects 157,674 1,776,636 1,803 Sub Total Energy Opportunites $ 1,660,160 $ 2,290,631 $ 3,950,791 $ 4,003,243 $ 4,003, % Projects 451,031 5,082,128 5,157 CNG O&M $ 707,186 $ 1,289,601 $ 1,996,787 $ 1,685,406 $ 1,685, % Projects 326,219 1,957,312 3,592 SCG O&M $ 575,811 $ 956,773 $ 1,532,584 $ 1,250,426 $ 1,250, % Projects 242,026 1,452,156 2,665 CNG Small Business $ 166,030 $ 190,529 $ 356,559 $ 332,979 $ 332, % Projects 37, , SCG Small Business $ 127,147 $ 164,808 $ 291,955 $ 288,028 $ 288, % Projects 32, , Subtotal Commercial & Industrial $ 6,560,779 $ 6,189,262 $ 12,750,041 $ 13,673,970 $ 13,673, % Projects 1,628,028 17,555,676 16,465 OTHER CNG CHIF, Residential, C&I Loan Program $ 308,225 SCG CHIF, Residential, C&I Loan Program $ 308,225 Sub Total Other - Loan Program $ 616,450 Sub Total Other - Evaluation $ 3,704,565 Subtotal Other $ 4,321,015 PROGRAM SUBTOTALS CNG Residential $ 8,197,519 $ 3,601,616 $ 11,799,135 $ 20,688,162 $ 22,288, % 1,124,916 22,065,838 53,621 SCG Residential $ 6,356,360 $ 2,625,833 $ 8,982,193 $ 13,946,113 $ 15,108, % 985,226 17,755,217 4,773 Residential Total $ 14,553,879 $ 6,227,449 $ 20,781,328 $ 34,634,275 37,396,246 CNG C&I $ 3,900,620 $ 3,739,873 $ 7,640,493 $ 8,251,503 $ 8,251, % 976,927 10,598,178 9,898 SCG C&I $ 2,660,159 $ 2,449,389 $ 5,109,548 $ 5,422,468 $ 5,422, % 651,100 6,957,498 6,566 C&I Total $ 6,560,779 $ 6,189,262 $ 12,750,041 $ 13,673,970 13,673,970 CNG Other $ 2,237, % SCG Other $ 2,083, % Other Total $ 4,321,015 $ - $ - $ - $ % CNG TOTAL $ 14,335,687 $ 7,341,490 $ 19,439,629 $ 28,939,665 $ 30,539, % 2,101,843 32,664,016 63,520 SCG TOTAL $ 11,099,986 $ 5,075,222 $ 14,091,741 $ 19,368,580 $ 20,530, % 1,636,326 24,712,715 11,340 GRAND TOTAL $ 25,435,673 $ 12,416,711 $ 33,531,369 $ 48,308,245 $ 51,070, % ,738,169 57,376,731 74,859 Sub Total HES Income Eligible $ 5,276,335 $ - $ 5,276,335 $ 10,092,699 $ 11,702, % ,952 Homes 658,279 12,930,547 5,755 Sub Total Home Energy Solutions $ 7,454,636 $ 3,425,767 $ 10,880,403 $ 20,146,263 $ 21,298, % ,574 Homes 1,070,859 21,368,533 49,973 Sub Total New Construction $ 756,166 $ 602,444 $ 1,358,610 $ 1,687,434 $ 1,687, % Homes 87,776 2,194, Sub Total Water Heating $ 614,942 $ 1,794,080 $ 2,409,022 $ 1,474,341 $ 1,474, % ,560 Units 147,805 1,873, Sub Total Lost Opportunity $ 3,324,445 $ 1,296,921 $ 4,621,366 $ 6,113,888 $ 6,113, % Projects 538,785 8,275,710 4,252 Sub Total O&M $ 1,282,997 $ 2,246,374 $ 3,529,371 $ 2,935,832 $ 2,935, % Projects 568,245 3,409,468 6,256 Sub Total Small Business $ 293,177 $ 355,336 $ 648,513 $ 621,007 $ 621, % Projects 69, , CNG IT, Planning, Evaluation, and EEB $ 1,929,323 SCG IT, Planning, Evaluation, and EEB $ 1,775,242 $ 57.2% 2,110,142 39,821,055 58,394 $ 25.8% 1,628,028 17,555,676 16,

115 Table B 2015 CNG Comparison of Programs Energy Savings (cont.) Table B 2015 COMPARISON OF CONSERVATION PROGRAMS RESIDENTIAL Program Annual Cost Rate ($/ccf) Lifetime Cost Rate ($/ccf) Annualized Savings Oil (gallons) Lifetime Savings Oil (gallons) Annualize d Savings Propane (gallons) Lifetime Savings Propane (gallons) Annual MMBTU Lifetime MMBTU Cost per Annual MMBTU Cost per Lifetime MMBTU CNG HES Income Eligible $ 8.05 $ , ,555 $ $ 3.98 SCG HES Income Eligible $ 7.98 $ , ,998 $ $ 3.95 CNG Home Energy Solutions $ 7.17 $ , ,930 2,826 56,522 74,829 1,493,609 $ $ 3.18 SCG Home Energy Solutions $ 6.62 $ , ,150 $ $ 3.22 Sub Total Home Energy Solutions $ 6.96 $ , ,930 2,826 56, ,988 2,334,759 $ $ 3.19 SCG Residential Behavior $ 3.11 $ , ,641 $ $ 5.73 CNG New Construction $ 8.23 $ , ,964 $ $ 3.20 SCG New Construction $ 9.17 $ ,714 92,839 $ $ 3.56 Sub Total New Construction $ 8.61 $ , ,803 $ $ 3.35 CNG Water Heating $ 4.16 $ ,605 96,383 $ $ 3.19 SCG Water Heating $ 4.16 $ ,605 96,383 $ $ 3.19 Sub Total Water Heating $ 4.16 $ , ,767 $ $ 3.19 Subtotal Residential $ 6.45 $ , ,930 2,826 56, ,930 4,233,524 $ $ 3.44 Commercial and Industrial C&I Lost CNG Energy Conscious Blueprint $ 6.21 $ , ,512 $ $ 3.93 SCG Energy Conscious Blueprint $ 6.11 $ , ,058 $ $ 3.86 Sub Total Lost Opportunity $ 6.17 $ , ,571 $ $ 3.90 Commercial and Industrial Large Retrofit CNG Energy Opportunities $ 3.54 $ , ,135 $ $ 3.06 SCG Energy Opportunities $ 3.93 $ , ,816 $ $ 3.39 Sub Total Energy Opportunites $ 3.68 $ , ,951 $ $ 3.17 CNG O&M $ 2.17 $ , ,407 $ $ 3.51 SCG O&M $ 2.38 $ , ,427 $ $ 3.85 Sub Total O&M $ 2.26 $ , ,834 $ $ 3.66 CNG Small Business $ 4.43 $ ,860 43,498 $ $ 3.82 SCG Small Business $ 3.92 $ ,339 37,626 $ $ 3.38 Sub Total Small Business $ 4.19 $ ,200 81,123 $ $ 3.61 Subtotal Commercial & Industrial $ 4.03 $ OTHER CNG CHIF, Residential, C&I Loan Program SCG CHIF, Residential, C&I Loan Program Sub Total Other - Loan Program CNG IT, Planning, Evaluation, and EEB SCG IT, Planning, Evaluation, and EEB Sub Total Other - Evaluation Subtotal Other PROGRAM SUBTOTALS CNG Residential $ 7.29 $ , ,930 2,826 56, ,551 2,406,512 $ $ 3.41 SCG Residential $ 6.45 $ ,380 1,827,012 $ $ 3.48 Residential Total $ 6.90 $ , ,930 2,826 56, ,930 4,233,524 $ $ 3.44 CNG C&I $ 3.99 $ ,526 1,090,553 $ $ 3.58 SCG C&I $ 4.09 $ , ,927 $ $ 3.72 C&I Total $ 4.03 $ ,524 1,806,479 $ $ 3.63 CNG Other 0 0 SCG Other 0 0 CNG TOTAL $ 6.82 $ , ,930 2,826 56, ,077 3,497,064 $ $ 4.10 SCG TOTAL $ 6.78 $ ,378 2,542,938 $ $ 4.37 GRAND TOTAL $ 6.80 $ , ,930 2,826 56, ,454 6,040,003 $ $ 4.21 Sub Total HES Income Eligible $ 8.02 $ ,737 1,330,553 $ $ 3.97 Other Total

116 Table C 2014 CNG Program Budget by Category Table C CNG 2014 Budget Details GAS CONSERVATION BUDGET ($000) Labor Materials & Supplies Outside Services Incentives Marketing Administrative Expenses TOTAL RESIDENTIAL HES Income Eligible $ 234,806 $ 2,500 $ 60,000 $ 2,429,951 $ 15,000 $ 2,600 $ 2,744,857 Home Energy Solutions (HES) $ 296,754 $ 4,000 $ 150,000 $ 3,962,710 $ 50,000 $ 7,560 $ 4,471,024 Residential New Construction $ 38,975 $ 1,000 $ 15,000 $ 376,775 $ 12,500 $ 2,500 $ 446,750 Water Heating $ 14,053 $ 300 $ 2,685 $ 276,200 $ 6,000 $ 1,000 $ 300,238 Subtotal Residential $ 584,588 $ 7,800 $ 227,685 $ 7,045,636 $ 83,500 $ 13,660 $ 7,962,869 COMMERCIAL & INDUSTRIAL LOST OPPORTUNITY Energy Conscious Blueprint $ 195,697 $ 5,000 $ 150,000 $ 1,566,726 $ 35,000 $ 5,000 $ 1,957,423 Subtotal C&I - Lost Opportunity $ 195,697 $ 5,000 $ 150,000 $ 1,566,726 $ 35,000 $ 5,000 $ 1,957,423 COMMERCIAL & INDUSTRIAL LARGE RETROFIT Energy Opportunities $ 120,417 $ 5,000 $ 50,000 $ 820,365 $ 25,000 $ 5,000 $ 1,025,782 Operations & Maintenance $ 25,178 $ 5,000 $ 75,000 $ 454,023 $ 10,000 $ 5,000 $ 574,201 Subtotal C&I - Lost Opportunity $ 145,595 $ 10,000 $ 125,000 $ 1,274,388 $ 35,000 $ 10,000 $ 1,599,983 Small Business $ 23,473 $ 500 $ 10,000 $ 107,835 $ 3,200 $ 15,000 $ 160,008 Subtotal C&I $ 364,765 $ 15,500 $ 285,000 $ 2,948,949 $ 73,200 $ 30,000 $ 3,717,414 OTHER - PROGRAMS/REQUIREMENTS & PLANNING OTHER - EDUCATION SmartLiving Center - Museum Partnerships $ 7,655 $ 2,000 $ 158,178 $ 5,000 $ 500 $ 173,333 Clean Energy Communities $ 36,905 $ 106,428 $ 143,333 EESmarts/K-12 $ 8,352 $ 1,300 $ 49,015 $ 7,000 $ 1,000 $ 66,667 Customer Engagement $ - $ 50,000 $ 50,000 Subtotal Education $ 52,912 $ 3,300 $ 363,621 $ - $ 12,000 $ 1,500 $ 433,333 OTHER - PROGRAMS/REQUIREMENTS ISE $ - $ - $ 37,333 $ - $ - $ - $ 37,333 ESPC $ - $ - $ 9,600 $ - $ - $ - $ 9,600 CHIF Loan Fund $ - $ - $ 100,045 $ - $ - $ - $ 100,045 Residential Financing Subsidies $ - $ - $ 79,667 $ - $ - $ - $ 79,667 C&I Financing Subsidies $ - $ - $ 75,000 $ - $ - $ - $ 75,000 Subtotal Programs/Requirements $ - $ - $ 301,645 $ - $ - $ - $ 301,645 OTHER - RD&D Research, Development and Demonstration $ - $ - $ 50,000 $ - $ - $ - $ 50,000 Subtotal Renewables & RD&D $ - $ - $ 50,000 $ - $ - $ - $ 50,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 100,654 $ - $ 20,675 $ - $ - $ 121,329 Marketing Plan $ - $ - $ 203,333 $ - $ - $ 203,333 Information Technology $ 13,321 $ - $ 120,012 $ - $ - $ 133,333 Planning $ 80,000 $ - $ - $ - $ - $ 80,000 Evaluation $ 20,418 $ - $ 208,465 $ - $ - $ 228,883 Evaluation Consultant $ - $ - $ 24,297 $ - $ - $ 24,297 Energy Efficiency Board $ - $ - $ 50,210 $ - $ - $ 50,210 Performance Fee $ - $ - $ - $ - $ - $ 661,607 $ 661,607 Subtotal Other $ 214,393 $ - $ 626,992 $ - $ - $ 661,607 $ 1,502,992 PROGRAM SUBTOTALS Residential $ 626,918 $ 10,440 $ 618,627 $ 7,045,636 $ 93,100 $ 14,860 $ 8,409,580 C&I $ 375,347 $ 16,160 $ 559,324 $ 2,948,949 $ 75,600 $ 30,300 $ 4,005,681 Other $ 214,393 $ - $ 676,992 $ - $ - $ 661,607 $ 1,552,992 TOTAL BUDGET $ 1,216,658 $ 26,600 $ 1,854,943 $ 9,994,585 $ 168,700 $ 706,767 $ 13,968,

117 Table C 2014 Pie CNG 2014 Gas Conservation Budget By Expense Class Marketing 1.2% Administrative Expenses 5.1% Labor 8.7% Materials & Supplies 0.2% Outside Services 13.3% Incentives 71.6% Expense Classes Budget % of Budget Labor $ 1,216, % Materials & Supplies $ 26, % Outside Services $ 1,854, % Incentives $ 9,994, % Marketing $ 168, % Administrative Expenses $ 706, % Total $ 13,968, % 111

118 Table C 2015 CNG Program Budget by Category Table C CNG 2015 Budget Details GAS CONSERVATION BUDGET ($000) Labor Materials & Supplies Outside Services Incentives Marketing Administrative Expenses TOTAL RESIDENTIAL HES Income Eligible $ 234,806 $ 2,500 $ 60,000 $ 2,406,787 $ 15,000 $ 2,600 $ 2,721,693 Home Energy Solutions (HES) $ 296,754 $ 4,000 $ 150,000 $ 4,236,198 $ 50,000 $ 6,027 $ 4,742,979 Residential New Construction $ 38,975 $ 1,000 $ 15,000 $ 355,401 $ 12,500 $ 2,500 $ 425,376 Water Heating $ 14,053 $ 300 $ 3,000 $ 281,135 $ 7,983 $ 1,000 $ 307,471 Subtotal Residential $ 584,588 $ 7,800 $ 228,000 $ 7,279,521 $ 85,483 $ 12,127 $ 8,197,519 COMMERCIAL & INDUSTRIAL LOST OPPORTUNITY Energy Conscious Blueprint $ 195,697 $ 5,000 $ 150,000 $ 1,581,945 $ 40,000 $ 15,000 $ 1,987,642 Subtotal C&I - Lost Opportunity $ 195,697 $ 5,000 $ 150,000 $ 1,581,945 $ 40,000 $ 15,000 $ 1,987,642 COMMERCIAL & INDUSTRIAL LARGE RETROFIT Energy Opportunities $ 120,417 $ 5,000 $ 50,000 $ 817,595 $ 36,250 $ 10,500 $ 1,039,762 Operations & Maintenance $ 25,178 $ 2,375 $ 25,000 $ 639,460 $ 10,423 $ 4,750 $ 707,186 Subtotal C&I - Lost Opportunity $ 145,595 $ 7,375 $ 75,000 $ 1,457,055 $ 46,673 $ 15,250 $ 1,746,948 Small Business $ 23,473 $ 500 $ 12,500 $ 104,557 $ 10,000 $ 15,000 $ 166,030 Subtotal C&I $ 364,765 $ 12,875 $ 237,500 $ 3,143,557 $ 96,673 $ 45,250 $ 3,900,620 OTHER - PROGRAMS/REQUIREMENTS & PLANNING OTHER - EDUCATION SmartLiving Center - Museum Partnerships $ 7,655 $ 2,000 $ 66,845 $ 5,000 $ 500 $ 82,000 Clean Energy Communities $ 36,905 $ 106,428 $ 143,333 EESmarts/K-12 $ 8,352 $ 1,300 $ 49,015 $ 7,000 $ 1,000 $ 66,667 Customer Engagement $ - $ 50,000 $ 50,000 Subtotal Education $ 52,912 $ 3,300 $ 272,288 $ - $ 12,000 $ 1,500 $ 342,000 OTHER - PROGRAMS/REQUIREMENTS ISE $ - $ - $ 37,333 $ - $ - $ - $ 37,333 ESPC $ - $ - $ 9,600 $ - $ - $ - $ 9,600 CHIF Loan Fund $ - $ - $ 99,959 $ - $ - $ - $ 99,959 Residential Financing Subsidies $ - $ - $ 86,333 $ - $ - $ - $ 86,333 C&I Financing Subsidies $ - $ - $ 75,000 $ - $ - $ - $ 75,000 Subtotal Programs/Requirements $ - $ - $ 308,225 $ - $ - $ - $ 308,225 OTHER - RD&D Research, Development and Demonstration $ - $ - $ 50,000 $ - $ - $ - $ 50,000 Subtotal Renewables & RD&D $ - $ - $ 50,000 $ - $ - $ - $ 50,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 100,654 $ - $ 20,675 $ - $ - $ 121,329 Marketing Plan $ - $ - $ 203,333 $ - $ - $ 203,333 Information Technology $ 13,321 $ - $ 120,012 $ - $ - $ 133,333 Planning $ 80,000 $ - $ - $ - $ - $ 80,000 Evaluation $ 20,418 $ - $ 225,299 $ - $ - $ 245,717 Evaluation Consultant $ - $ - $ 24,297 $ - $ - $ 24,297 Energy Efficiency Board $ - $ - $ 50,210 $ - $ - $ 50,210 Performance Fee $ - $ - $ - $ - $ - $ 679,104 $ 679,104 Subtotal Other $ 214,393 $ - $ 643,826 $ - $ - $ 679,104 $ 1,537,323 PROGRAM SUBTOTALS Residential $ 626,918 $ 10,440 $ 545,789 $ 7,279,521 $ 95,083 $ 13,327 $ 8,571,078 C&I $ 375,347 $ 13,535 $ 500,224 $ 3,143,557 $ 99,073 $ 45,550 $ 4,177,286 Other $ 214,393 $ - $ 693,826 $ - $ - $ 679,104 $ 1,587,323 TOTAL BUDGET $ 1,216,658 $ 23,975 $ 1,739,839 $ 10,423,078 $ 194,156 $ 737,981 $ 14,335,

119 Table C 2015 Pie CNG 2015 Gas Conservation Budget By Expense Class Marketing 1.4% Administrative Expenses 5.1% Labor 8.5% Materials & Supplies 0.2% Outside Services 12.1% Incentives 72.7% Expense Classes Budget % of Budget Labor $ 1,216, % Materials & Supplies $ 23, % Outside Services $ 1,739, % Incentives $ 10,423, % Marketing $ 194, % Administrative Expenses $ 737, % Total $ 14,335, % 113

120 Table D CNG Historical and Projected Program Expenditures and Units Table D CNG Historical and Projected $ and Units RESIDENTIAL Expenditures $ (000) Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal HES Income Eligible - Weatherization $ 443 $ 401 $ 431 $ 666 $ 805 $ 1,035 $ 838 $ 904 $ 2,745 $ 2,722 Home Energy Solutions (HES) $ 52 $ 428 $ 795 $ 520 $ 1,368 $ 1,518 $ 1,548 $ 2,014 $ 4,471 $ 4,743 Residential New Construction $ - $ - $ - $ 179 $ 422 $ 905 $ 477 $ 1,374 $ 447 $ 425 Water Heating $ - $ - $ 38 $ 92 $ 59 $ 45 $ 45 $ 22 $ 300 $ 307 Subtotal Residential $ 496 $ 829 $ 1,264 $ 1,456 $ 2,654 $ 3,503 $ 2,908 $ 4,314 $ 7,963 $ 8,198 COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint $ - $ - $ 242 $ 572 $ 727 $ 873 $ 1,262 $ 1,177 $ 1,957 $ 1,988 Total - Lost Opportunity $ - $ - $ 242 $ 572 $ 727 $ 873 $ 1,262 $ 1,177 $ 1,957 $ 1,988 C&I LARGE RETROFIT Energy Opportunities $ - $ - $ 17 $ 140 $ 325 $ 471 $ 778 $ 1,536 $ 1,026 $ 1,040 O&M (RetroCx, Training) $ - $ - $ 3 $ 8 $ 14 $ 29 $ 160 $ 90 $ 574 $ 707 Total - C&I Large Retrofit $ - $ - $ 20 $ 148 $ 339 $ 500 $ 938 $ 1,626 $ 1,600 $ 1,747 Small Business $ - $ - $ - $ - $ - $ - $ 51 $ 210 $ 160 $ 166 Subtotal C&I $ - $ - $ 262 $ 721 $ 1,067 $ 1,374 $ 2,251 $ 3,013 $ 3,717 $ 3,901 PROGRAM SUB-TOTALS Residential $ 496 $ 829 $ 1,264 $ 1,456 $ 2,654 $ 3,503 $ 2,908 $ 4,314 $ 7,963 $ 8,198 C&I $ - $ - $ 262 $ 721 $ 1,067 $ 1,374 $ 2,251 $ 3,013 $ 3,717 $ 3,901 TOTAL $ 496 $ 829 $ 1,526 $ 2,177 $ 3,721 $ 4,877 $ 5,159 $ 7,327 $ 11,680 $ 12,098 RESIDENTIAL Units Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal HES Income Eligible - Weatherization ,492 1,428 1,720 1, ,124 4,085 Home Energy Solutions (HES) ,918 1,064 3,251 1,895 2,709 4,543 5,553 5,936 Residential New Construction Water Heating ,280 2,280 Subtotal Residential 948 1,519 2,965 2,941 5,024 4,069 4,185 5,714 12,164 12,495 COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint Total - Lost Opportunity C&I LARGE RETROFIT Energy Opportunities O&M (RetroCx, Training) Total - C&I Large Retrofit Small Business Subtotal C&I PROGRAM SUB-TOTALS Residential 948 1,519 2,965 2,941 5,024 4,069 4,185 5,714 12,164 12,495 C&I TOTAL 948 1,519 2,976 2,979 5,081 4,162 4,316 5,891 12,249 12,

121 Table D1 CNG Historical and Projected Annual and Lifetime CCF Table D CNG Historical and Projected Annual and Lifetime ccf RESIDENTIAL Annual ccf (000) Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal HES Income Eligible - Weatherization Home Energy Solutions (HES) Residential New Construction Water Heating Subtotal Residential ,090 1,125 COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint Total - Lost Opportunity C&I LARGE RETROFIT Energy Opportunities O&M (RetroCx, Training) Total - C&I Large Retrofit Small Business Subtotal C&I PROGRAM SUB-TOTALS Residential ,090 1,125 C&I TOTAL ,180 1,499 1,971 2,102 Lifetime ccf (000) Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal RESIDENTIAL HES Income Eligible - Weatherization ,161 2,062 2,752 2,500 1,612 6,707 6,643 Home Energy Solutions (HES) ,971 1,419 5,414 3,416 4,997 7,461 12,359 13,194 Residential New Construction ,675 1,382 1,292 Water Heating Subtotal Residential 1,118 1,864 2,963 4,599 8,691 7,325 8,463 10,773 21,384 22,066 COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint ,351 1,578 2,343 4,294 6,670 4,865 4,913 Total - Lost Opportunity ,351 1,578 2,343 4,294 6,670 4,865 4,913 C&I LARGE RETROFIT Energy Opportunities ,439 1,483 2,094 4,517 3,317 3,305 O&M (RetroCx, Training) , ,853 1,957 Total - C&I Large Retrofit ,523 1,809 3,267 4,983 5,170 5,263 Small Business Subtotal C&I ,183 3,101 4,153 7,753 12,095 10,471 10,598 PROGRAM SUB-TOTALS Residential 1,118 1,864 2,963 4,599 8,691 7,325 8,463 10,773 21,384 22,066 C&I ,183 3,101 4,153 7,753 12,095 10,471 10,598 TOTAL 1,118 1,864 3,380 6,782 11,792 11,478 16,216 22,868 31,855 32,

122 Incentive $ Earned CNG Performance Incentive 2014 CONNECTICUT NATURAL GAS CORPORATION 2014 Management Incentive Performance Indicators and Incentive Matrix Provided below is the 2014 Incentive Matrix with Performance Indicators. The Utility Performance Incentive is $661,607 This calculated is based on achieving 100% of all performance targets and earning a target incentive of 5% of C&LM budgets (not including ECMB costs, Audit Costs or Management Incentive). Goals will be prorated based on actual over/under spend of budget. The actual incentive earned will be determined by the performance achieved in each of the Incentive Metrics identified below, based on the following Performance Index: Performance % Pretax Incentive Pre-tax Incentive % $330, % $396, % $529, % $661, % $793, % $926, % $1,058,571 $1,500,000 $1,300,000 $1,100,000 $900,000 $700,000 $500,000 $300,000 $100,000 Incentive $ Earned vs Performance Achieved Total Original Budget* $13,232,139 Performance Achieved % of Target *Does not include Incentive, ECMB costs and Audit 116

123 CNG Performance Incentive 2014 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive Residential Program Budgets $ 7,962,869 Lifetime Savings (ccf): HES Income Eligible 6,706,839 Total Gas Benefit from all Residential programs Gas Benefit from all Residential programs $17,147, $129,013 Home Energy Solutions 12,358,649 New Construction 1,382,277 Water Heating 936,671 Total Lifetime Savings (ccf) 21,384,436 Present Value Lifetime Savings (ccf) $ Total Residential Gas Benefit: $17,147,765 Net Residential Gas Benefit: Number of Water Heating Units (tankless and condensing) per DEEP Final Water Heating $ 300,238 Number of Units $6,616 Decision HES $ 4,471,024 Achieve ccf savings per single family home ccf/home $33,080 HES-IE $ 2,744,857 Annual ccf savings Annual ccf savings 341, $19,848 $9,184,896 $9,184, $129,

124 CNG Performance Incentive 2014 (cont.) SECTOR Program Performance Indicators C&I Program Budgets $ 3,717,414 Lifetime Savings (ccf): Energy Conscious Blueprint 4,865,394 Energy Opportunities 3,316,691 O&M 1,852,948 Small Business 435,971 Total Lifetime Savings (ccf) 10,471,004 Present Value Lifetime Savings (ccf) $ Total C&I Gas Benefit: $8,528,803 Small Business $ 160,008 Number of gas projects that are comprehensive or implement measure bundles or Number of projects that consist of at least two gas measures Comprehensive is defined as 1. More than one End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, and involves an End Use with a natural gas measure. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings Only SBEA projects are eligible Calculations based on signed projects with gas, no Rebates: [ (# of signed projects with gas - any rebate projects) / (total # of signed SBEA projects with gas - any rebate projects)] Small Business projects may also be comprehensive by utilizing bundled measures. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Energy Star Natural Gas or Electric Dishwashers. Incentive Metrics Total Gas Benefit from all C&I programs Gas Benefit from all C&I programs $8,528,803 Incentive Metric Target Goal $138,937 % of Gas Projects 10% of signed projects $19,848 Net C&I Gas Benefit: $4,811,389 $4,811, $138,

125 CNG Performance Incentive 2014 (cont.) SECTOR Program Energy Blueprint / Energy Opportunities Manufacturing Customer Projects Total Incentive $ Residential and C&I Performance Indicators Percentage of signed gas only projects containing multiple measures Projects must fall within Energy Opportunities or Energy Conscious Blueprint programming; Projects must contain multiple gas measures; No restriction to the number of enduses; No SBEA projects are included, Calculations based on signed projects, no Rebates: [ (# of signed projects - rebate projects) / (total # of signed projects from all large C&I - all rebate projects)] Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the gas energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] Incentive Metrics Incentive Metric Target Goal Weight Incentive % of Gas Projects 15% of signed projects $19,848 % of Savings Via Signed Contracts 20% of Savings Via Signed Contracts $26, $661,

126 Incentive $ Earned CNG Performance Incentive 2015 CONNECTICUT NATURAL GAS CORPORATION 2015 Management Incentive Performance Indicators and Incentive Matrix Provided below is the 2015 Incentive Matrix with Performance Indicators. The Utility Performance Incentive is $679,104 This calculated is based on achieving 100% of all performance targets and earning a target incentive of 5% of C&LM budgets (not including ECMB costs, Audit Costs or Management Incentive). Goals will be prorated based on actual over/under spend of budget. The actual incentive earned will be determined by the performance achieved in each of the Incentive Metrics identified below, based on the following Performance Index: Incentive $ Earned vs Performance Achieved Performance % Pretax Incentive Pre-tax Incentive % $407, % $543, % $679, % $814, % $950, % $1,086, Performance Achieved % of Target Total Original Budget* $13,582,

127 CNG Performance Incentive 2015 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive Residential Program Budgets $ 8,197,519 Lifetime Savings (ccf): HES Income Eligible 6,642,905 Total Gas Benefit from all Residential programs Gas Benefit from all Residential programs $17,202, $132,425 Home Energy Solutions 13,194,092 New Construction 1,292,171 Water Heating 936,671 Total Lifetime Savings (ccf) 22,065,838 Present Value Lifetime Savings (ccf) $ Total Residential Gas Benefit: $17,202,844 Net Residential Gas Benefit: Number of Water Heating Units (tankless and condensing) per DEEP Final Water Heating $ 307,471 Number of Units $6,791 Decision HES $ 4,742,979 Achieve ccf savings per single family home ccf/home $33,955 HES-IE $ 2,721,693 Annual ccf savings Annual ccf savings 338, $20,373 $9,005,325 $9,005, $132,

128 CNG Performance Incentive 2015 (cont.) SECTOR Program Performance Indicators C&I Program Budgets $ 3,900,620 Lifetime Savings (ccf): Energy Conscious Blueprint 4,912,656 Energy Opportunities 3,305,492 O&M 1,957,312 Small Business 422,718 Total Lifetime Savings (ccf) 10,598,178 Present Value Lifetime Savings (ccf) $ Total C&I Gas Benefit: $8,251,503 Small Business $ 166,030 Number of gas projects that are comprehensive or implement measure bundles or Number of projects that consist of at least two gas measures Comprehensive is defined as 1. More than one End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, and involves an End Use with a natural gas measure. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings Only SBEA projects are eligible Calculations based on signed projects with gas, no Rebates: [ (# of signed projects with gas - any rebate projects) / (total # of signed SBEA projects with gas - any rebate projects)] Small Business projects may also be comprehensive by utilizing bundled measures. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Energy Star Natural Gas or Electric Dishwashers. Incentive Metrics Incentive Metric Target Goal Weight Incentive Total Gas Benefit from all C&I programs Gas Benefit from all C&I programs $8,251, $142,612 % of Gas Projects 12% of signed projects $20,373 Net C&I Gas Benefit: $4,350,883 $4,350, $142,

129 CNG Performance Incentive 2015 (cont.) SECTOR Program Energy Blueprint / Energy Opportunities Manufacturing Customer Projects Total Incentive $ Residential and C&I Performance Indicators Percentage of signed gas only projects containing multiple measures Projects must fall within Energy Opportunities or Energy Conscious Blueprint programming; Projects must contain multiple gas measures; No restriction to the number of enduses; No SBEA projects are included, Calculations based on signed projects, no Rebates: [ (# of signed projects - rebate projects) / (total # of signed projects from all large C&I - all rebate projects)] Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the gas energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] Incentive Metrics Incentive Metric Target Goal Weight Incentive % of Gas Projects 17% of signed projects $20,373 % of Savings Via Signed Contracts 22% of Savings Via Signed Contracts $27, $679,

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131 The Southern Connecticut Gas Company Budget Tables 125

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133 Table A SCG 2013 Actual Results, Budget Table A SCG Proposed Natural Gas Conservation Plan Budget SCG SCG SCG Natural Gas C&LM Budget Actual Approved Approved Expenditures Budget Budget RESIDENTIAL HES Income Eligible - Weatherization $ 3,815,862 $ 2,680,076 $ 2,554,642 Home Energy Solutions (HES) $ 1,666,061 $ 2,545,354 $ 2,711,657 Residential Behavior $ - $ 541,800 $ 451,800 Residential New Construction $ 595,732 $ 351,535 $ 330,790 Water Heating $ 38,552 $ 300,238 $ 307,471 Subtotal Residential $ 6,116,207 $ 6,419,003 $ 6,356,360 COMMERCIAL & INDUSTRIAL C&I LOST OPPORTUNITY Energy Conscious Blueprint $ 697,324 $ 1,357,784 $ 1,336,803 Total - Lost Opportunity $ 697,324 $ 1,357,784 $ 1,336,803 C&I LARGE RETROFIT Energy Opportunities $ 835,668 $ 628,862 $ 620,398 O&M (RetroCx, Training) $ (20,435) $ 477,726 $ 575,811 Total - C&I Large Retrofit $ 815,233 $ 1,106,588 $ 1,196,209 Small Business $ 91,643 $ 124,329 $ 127,147 Subtotal C&I $ 1,604,200 $ 2,588,701 $ 2,660,159 OTHER - Education SmartLiving Center -Museums Partnership $ 173,333 $ 82,000 EE Communities $ 21,789 $ 143,333 $ 143,333 EESmarts/K-12 $ 66,667 $ 66,667 Customer Engagement $ 50,000 $ 50,000 Subtotal Education $ 21,789 $ 433,333 $ 342,000 OTHER - PROGRAMS/REQUIREMENTS ISE $ 37,333 $ 37,333 ESPC $ 9,600 $ 9,600 Resi Financing/CHIF Loan Fund $ 78,896 $ 100,045 $ 99,959 C&LM Loan Defaults $ 75,000 $ 86,333 C&I Financing Subsidies $ 4,637 $ 79,667 $ 75,000 Subtotal Programs/Requirements $ 83,533 $ 301,645 $ 308,225 Research, Development and Demonstration $ 85,800 $ 50,000 $ 50,000 Subtotal RD&D $ 85,800 $ 50,000 $ 50,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 88,901 $ 121,329 $ 121,329 Marketing Plan $ - $ 203,333 $ 203,333 Information Technology $ 14,291 $ 133,333 $ 133,333 Planning $ 151,019 $ 80,000 $ 80,000 Evaluation $ 23,912 $ 228,883 $ 245,717 Evaluation Consultant $ 24,297 $ 24,297 Energy Efficiency Board $ 43,373 $ 50,210 $ 50,210 Performance Fee $ 655,172 $ 527,978 $ 525,023 Subtotal Other - Administrative & Planning $ 976,668 $ 1,369,363 $ 1,383,242 PROGRAM SUBTOTALS Residential $ 6,212,534 $ 6,865,714 $ 6,729,919 C&I $ 1,613,195 $ 2,876,968 $ 2,936,825 Other $ 1,062,468 $ 1,419,363 $ 1,433,242 TOTAL $ 8,888,197 $ 11,162,045 $ 11,099,

134 Table A 2014 Pie SCG 2014 Budget Analysis Budget By Customer Class Res. Income Eligible 20.03% Commercial and Industrial 33.09% Res. Non Income Eligible 46.88% Customer Class Budget % of Total Conservation Budget % of Residential & C&I Budget Res. Income Eligible $2,680, % 20.03% Res. Non Income Eligible $4,185, % 46.88% Residential Subtotal $6,865, % 66.91% Commercial and Industrial $2,876, % 33.09% C&I Subtotal $2,876, % 33.09% Residential and C&I Subtotal $9,742, % % Other Expenditures Other Expenditures $1,419, % Other Expenditures Subtotal $1,419, % TOTAL $11,162, % 128

135 Table A 2015 Pie SCG 2015 Budget Analysis Budget By Customer Class Res. Income Eligible 19.09% Commercial and Industrial 31.54% Res. Non Income Eligible 49.36% Customer Class Budget % of Total Conservation Budget % of Residential & C&I Budget Res. Income Eligible $3,815, % 19.09% Res. Non Income Eligible $2,914, % 49.36% Residential Subtotal $6,729, % 68.46% Commercial and Industrial $2,936, % 31.54% C&I Subtotal $2,936, % 31.54% Residential and C&I Subtotal $9,666, % % Other Expenditures Other Expenditures $1,433, % Other Expenditures Subtotal $1,433, % TOTAL $11,099, % 129

136 Table B 2014 SCG Comparison of Program Energy Savings Table B 2014 COMPARISON OF CONSERVATION PROGRAMS RESIDENTIAL Program Program Costs 2014 Customer Cost 2014 Total Resource Cost 2014 Program Benefit (Gas & Oil) Total Resource Benefit % of 2014 Budget Program B/C Ratio Total Resource B/C Ratio Goals/ # Units Units of Measure Annualized Savings (ccf) CNG HES Income Eligible $ 2,744,857 $ - $ 2,744,857 $ 5,383,952 $ 6,202, % ,124 Homes 341,437 6,706,839 2,985 SCG HES Income Eligible $ 2,680,076 $ - $ 2,680,076 $ 5,325,359 $ 6,135, % ,080 Homes 337,721 6,633,849 2,953 Lifetime Savings (ccf) Peak Day Savings (ccf) CNG Home Energy Solutions $ 4,471,024 $ 2,218,939 $ 6,689,963 $ 13,313,088 $ 14,008, % ,553 SCG Home Energy Solutions $ 2,545,354 $ 1,006,537 $ 3,551,891 $ 6,141,533 $ 6,473, % ,402 Homes & HVAC Rebated 619,313 12,358,649 5,529 Homes & HVAC Rebated 383,859 7,658,261 3,489 SCG Residential Behavior $ 541,800 $ 412,268 $ 954,068 $ 1,337,714 $ 1,337, % ,500 Thermostats 145,424 1,454,241 1,421 CNG New Construction $ 446,750 $ 1,085,424 $ 1,409,481 $ 1,078,969 $ 1,078, % Homes 55,291 1,382, SCG New Construction $ 351,535 $ 774,564 $ 1,008,403 $ 770,921 $ 770, % Homes 39, , CNG Water Heating $ 300,238 $ 897,040 $ 1,173,040 $ 776,576 $ 776, % ,280 Units 73, , SCG Water Heating $ 300,238 $ 897,040 $ 1,173,040 $ 776,576 $ 776, % ,280 Units 73, , Subtotal Residential $ 14,381,872 $ 7,291,812 $ 21,384,820 $ 34,904,688 $ 37,560, % ,573 Homes/ Units 2,070,354 39,055,041 17,205 Commercial and Industrial C&I Lost CNG Energy Conscious Blueprint $ 1,957,423 $ 762,476 $ 2,719,899 $ 3,738,115 $ 3,738, % Projects 316,759 4,865,394 2,500 SCG Energy Conscious Blueprint $ 1,357,784 $ 541,872 $ 1,899,656 $ 2,656,583 $ 2,656, % Projects 225,112 3,457,711 1,776 Commercial and Industrial Large Retrofit YGS Energy Opportunities CNG Energy Opportunities $ 1,025,782 $ 1,494,908 $ 2,520,690 $ 2,773,147 $ 2,773, % Projects 294,351 3,316,691 3,365 SCG Energy Opportunities $ 628,862 $ 797,971 $ 1,426,833 $ 1,480,286 $ 1,480, % Projects 157,123 1,770,426 1,796 Sub Total Energy Opportunites $ 1,654,644 $ 2,292,880 $ 3,947,524 $ 4,253,434 $ 4,253, % Projects 451,474 5,087,117 5,162 CNG O&M $ 574,201 $ 915,630 $ 1,489,831 $ 1,653,016 $ 1,653, % Projects 231,618 1,852,948 2,550 SCG O&M $ 477,726 $ 771,064 $ 1,248,790 $ 1,392,028 $ 1,392, % Projects 195,049 1,560,393 2,147 CNG Small Business $ 160,008 $ 196,502 $ 356,510 $ 364,524 $ 364, % Projects 38, , SCG Small Business $ 124,329 $ 159,181 $ 283,510 $ 295,290 $ 295, % Projects 31, , Subtotal Commercial & Industrial $ 6,306,115 $ 5,639,605 $ 11,945,720 $ 14,352,989 $ 14,352, % Projects 1,490,047 17,612,701 14,936 OTHER CNG CHIF, Residential, C&I Loan Program $ 301, % SCG CHIF, Residential, C&I Loan Program $ 301, % Sub Total Other - Loan Program $ 603, % CNG IT, Planning, Evaluation, and EEB $ 1,986, % SCG IT, Planning, Evaluation, and EEB $ 1,852, % Sub Total Other - Evaluation $ 3,839, % Subtotal Other $ 4,442, % PROGRAM SUBTOTALS CNG Residential $ 7,962,869 $ 4,201,403 $ 12,017,341 $ 20,552,585 $ 22,066, % 1,089,944 21,384,436 8,958 SCG Residential $ 6,419,003 $ 3,090,409 $ 9,367,478 $ 14,352,103 $ 15,493, % 980,410 17,670,606 8,247 Residential Total $ 14,381,872 $ 7,291,812 $ 21,384,820 $ 34,904,688 37,560,716 CNG C&I $ 3,717,414 $ 3,369,516 $ 7,086,930 $ 8,528,803 $ 8,528, % 881,420 10,471,004 8,857 SCG C&I $ 2,588,701 $ 2,270,089 $ 4,858,790 $ 5,824,187 $ 5,824, % 608,627 7,141,697 6,079 C&I Total $ 6,306,115 $ 5,639,605 $ 11,945,720 $ 14,352,989 14,352,989 CNG Other $ 2,287, % SCG Other $ 2,154, % Other Total $ 4,442,311 $ - $ - $ - $ % CNG TOTAL $ 13,968,253 $ 7,570,919 $ 19,104,272 $ 29,081,387 $ 30,595, % 1,971,364 31,855,440 17,815 SCG TOTAL $ 11,162,045 $ 5,360,498 $ 14,226,268 $ 20,176,290 $ 21,318, % 1,589,037 24,812,303 14,326 GRAND TOTAL $ 25,130,298 $ 12,931,417 $ 33,330,540 $ 49,257,677 $ 51,913, % ,560,402 56,667,743 32,141 Sub Total HES Income Eligible $ 5,424,933 $ - $ 5,424,933 $ 10,709,311 $ 12,337, % ,204 Homes 679,158 13,340,688 5,938 Sub Total Home Energy Solutions $ 7,016,378 $ 3,225,476 $ 10,241,854 $ 19,454,621 $ 20,482, % ,956 Homes 1,003,173 20,016,911 9,018 Sub Total New Construction $ 798,285 $ 1,859,988 $ 2,417,884 $ 1,849,890 $ 1,849, % Homes 94,794 2,369, Sub Total Water Heating $ 600,476 $ 1,794,080 $ 2,346,080 $ 1,553,152 $ 1,553, % ,560 Units 147,805 1,873, Sub Total Lost Opportunity $ 3,315,207 $ 1,304,348 $ 4,619,555 $ 6,394,698 $ 6,394, % Projects 541,871 8,323,105 4,276 Sub Total O&M $ 1,051,927 $ 1,686,694 $ 2,738,621 $ 3,045,044 $ 3,045, % Projects 426,668 3,413,341 4,698 Sub Total Small Business $ 284,337 $ 355,683 $ 640,020 $ 659,813 $ 659, % Projects 70, , $ 57.2% 2,070,354 39,055,041 17,205 $ 25.1% 1,490,047 17,612,701 14,

137 Table B 2014 SCG Comparison of Program Energy Savings (cont.) Table B 2014 COMPARISON OF CONSERVATION PROGRAMS RESIDENTIAL Program Annual Cost Rate ($/ccf) Lifetime Cost Rate ($/ccf) Annualized Savings Oil (gallons) Lifetime Savings Oil (gallons) Annualized Savings Propane (gallons) Lifetime Savings Propane (gallons) Annual MMBTU Lifetime MMBTU Cost per Annual MMBTU Cost per Lifetime MMBTU CNG HES Income Eligible $ 8.04 $ , ,134 $ $ 3.98 SCG HES Income Eligible $ 7.94 $ , ,623 $ $ 3.93 CNG Home Energy Solutions $ 7.22 $ , ,152 2,761 55,217 70,367 1,404,502 $ $ 3.18 SCG Home Energy Solutions $ 6.63 $ , ,035 $ $ 3.23 Sub Total Home Energy Solutions $ 6.99 $ , ,152 2,761 55, ,866 2,192,538 $ $ 3.20 SCG Residential Behavior $ 6.56 $ , ,641 $ $ 6.38 CNG New Construction $ 8.08 $ , ,236 $ $ 3.14 SCG New Construction $ 8.90 $ , ,622 $ $ 3.46 Sub Total New Construction $ 8.42 $ , ,859 $ $ 3.27 CNG Water Heating $ 4.06 $ ,605 96,383 $ $ 3.12 SCG Water Heating $ 4.06 $ ,605 96,383 $ $ 3.12 Sub Total Water Heating $ 4.06 $ , ,767 $ $ 3.12 Subtotal Residential $ 6.95 $ , ,152 2,761 55, ,679 4,151,561 $ $ 3.46 Commercial and Industrial C&I Lost CNG Energy Conscious Blueprint $ 6.18 $ , ,649 $ $ 3.91 SCG Energy Conscious Blueprint $ 6.03 $ , ,798 $ $ 3.82 Sub Total Lost Opportunity $ 6.12 $ , ,448 $ $ 3.87 Commercial and Industrial Large Retrofit YGS Energy Opportunities CNG Energy Opportunities $ 3.48 $ , ,288 $ $ 3.01 SCG Energy Opportunities $ 4.00 $ , ,177 $ $ 3.45 Sub Total Energy Opportunites $ 3.66 $ , ,464 $ $ 3.16 CNG O&M $ 2.48 $ , ,668 $ $ 3.01 SCG O&M $ 2.45 $ , ,564 $ $ 2.98 Sub Total O&M $ 2.47 $ , ,233 $ $ 2.99 CNG Small Business $ 4.14 $ ,981 44,861 $ $ 3.57 SCG Small Business $ 3.97 $ ,225 36,341 $ $ 3.42 Sub Total Small Business $ 4.06 $ ,207 81,202 $ $ 3.50 Subtotal Commercial & Industrial $ 4.23 $ OTHER CNG CHIF, Residential, C&I Loan Program SCG CHIF, Residential, C&I Loan Program Sub Total Other - Loan Program CNG IT, Planning, Evaluation, and EEB SCG IT, Planning, Evaluation, and EEB Sub Total Other - Evaluation Subtotal Other PROGRAM SUBTOTALS CNG Residential $ 7.31 $ , ,152 2,761 55, ,795 2,333,256 $ $ 3.41 SCG Residential $ 6.55 $ ,884 1,818,305 $ $ 3.53 Residential Total $ 6.95 $ , ,152 2,761 55, ,679 4,151,561 $ $ 3.46 CNG C&I $ 4.22 $ ,698 1,077,466 $ $ 3.45 SCG C&I $ 4.25 $ , ,881 $ $ 3.52 C&I Total $ 4.23 $ ,326 1,812,347 $ $ 3.48 CNG Other 0 0 SCG Other 0 0 CNG TOTAL $ 7.09 $ , ,152 2,761 55, ,493 3,410,722 $ $ 4.10 SCG TOTAL $ 7.02 $ ,512 2,553,186 $ $ 4.37 GRAND TOTAL $ 7.06 $ , ,152 2,761 55, ,005 5,963,908 $ $ 4.21 Sub Total HES Income Eligible $ 7.99 $ ,885 1,372,757 $ $ 3.95 Other Total

138 Table B 2015 SCG Comparison of Programs Energy Savings Table B 2015 COMPARISON OF CONSERVATION PROGRAMS RESIDENTIAL Program Program Costs 2015 Customer Cost 2015 Total Resource Cost 2015 Program Benefit (Gas & Oil) Total Resource Benefit % of 2015 Budget Program B/C Ratio Total Resource B/C Ratio Goals/ # Units Units of Measure Annualized Savings (ccf) CNG HES Income Eligible $ 2,721,693 $ - $ 2,721,693 $ 5,184,996 $ 6,012, % ,085 Homes 338,182 6,642,905 2,957 SCG HES Income Eligible $ 2,554,642 $ - $ 2,554,642 $ 4,907,703 $ 5,690, % ,867 Homes 320,096 6,287,642 2,799 Lifetime Savings (ccf) Peak Day Savings (ccf) CNG Home Energy Solutions $ 4,742,979 $ 2,353,092 $ 7,096,071 $ 13,772,321 $ 14,545, % ,936 SCG Home Energy Solutions $ 2,711,657 $ 1,072,675 $ 3,784,332 $ 6,373,942 $ 6,753, % ,638 Homes & HVAC Rebated 661,144 13,194,092 49,973 Homes & HVAC Rebated 409,714 8,174,441 0 SCG Residential Behavior $ 451,800 $ 405,158 $ 856,958 $ 1,233,538 $ 1,233, % ,500 Thermostats 145,424 1,454,241 1,421 CNG New Construction $ 425,376 $ 351,484 $ 776,860 $ 993,674 $ 993, % Homes 51,687 1,292, SCG New Construction $ 330,790 $ 250,960 $ 581,750 $ 693,760 $ 693, % Homes 36, , CNG Water Heating $ 307,471 $ 897,040 $ 1,204,511 $ 737,170 $ 737, % ,280 Units 73, , SCG Water Heating $ 307,471 $ 897,040 $ 1,204,511 $ 737,170 $ 737, % ,280 Units 73, , Subtotal Residential $ 14,553,879 $ 6,227,449 $ 20,781,328 $ 34,634,275 $ 37,396, % ,913 Homes/ Units 2,255,566 41,275,296 59,815 Commercial and Industrial C&I Lost CNG Energy Conscious Blueprint $ 1,987,642 $ 769,883 $ 2,757,525 $ 3,629,348 $ 3,629, % Projects 319,835 4,912,656 2,524 SCG Energy Conscious Blueprint $ 1,336,803 $ 527,038 $ 1,863,841 $ 2,484,540 $ 2,484, % Projects 218,950 3,363,054 1,728 Commercial and Industrial Large Retrofit CNG Energy Opportunities $ 1,039,762 $ 1,489,861 $ 2,529,623 $ 2,603,769 $ 2,603, % Projects 293,357 3,305,492 3,354 SCG Energy Opportunities $ 620,398 $ 800,770 $ 1,421,168 $ 1,399,474 $ 1,399, % Projects 157,674 1,776,636 1,803 Sub Total Energy Opportunites $ 1,660,160 $ 2,290,631 $ 3,950,791 $ 4,003,243 $ 4,003, % Projects 451,031 5,082,128 5,157 CNG O&M $ 707,186 $ 1,289,601 $ 1,996,787 $ 1,685,406 $ 1,685, % Projects 326,219 1,957,312 3,592 SCG O&M $ 575,811 $ 956,773 $ 1,532,584 $ 1,250,426 $ 1,250, % Projects 242,026 1,452,156 2,665 CNG Small Business $ 166,030 $ 190,529 $ 356,559 $ 332,979 $ 332, % Projects 37, , SCG Small Business $ 127,147 $ 164,808 $ 291,955 $ 288,028 $ 288, % Projects 32, , Subtotal Commercial & Industrial $ 6,560,779 $ 6,189,262 $ 12,750,041 $ 13,673,970 $ 13,673, % Projects 1,628,028 17,555,676 16,465 OTHER CNG CHIF, Residential, C&I Loan Program $ 308,225 SCG CHIF, Residential, C&I Loan Program $ 308,225 Sub Total Other - Loan Program $ 616,450 Sub Total Other - Evaluation $ 3,704,565 Subtotal Other $ 4,321,015 PROGRAM SUBTOTALS CNG Residential $ 8,197,519 $ 3,601,616 $ 11,799,135 $ 20,688,162 $ 22,288, % 1,124,916 22,065,838 53,621 SCG Residential $ 6,356,360 $ 2,625,833 $ 8,982,193 $ 13,946,113 $ 15,108, % 985,226 17,755,217 4,773 Residential Total $ 14,553,879 $ 6,227,449 $ 20,781,328 $ 34,634,275 37,396,246 CNG C&I $ 3,900,620 $ 3,739,873 $ 7,640,493 $ 8,251,503 $ 8,251, % 976,927 10,598,178 9,898 SCG C&I $ 2,660,159 $ 2,449,389 $ 5,109,548 $ 5,422,468 $ 5,422, % 651,100 6,957,498 6,566 C&I Total $ 6,560,779 $ 6,189,262 $ 12,750,041 $ 13,673,970 13,673,970 CNG Other $ 2,237, % SCG Other $ 2,083, % Other Total $ 4,321,015 $ - $ - $ - $ % CNG TOTAL $ 14,335,687 $ 7,341,490 $ 19,439,629 $ 28,939,665 $ 30,539, % 2,101,843 32,664,016 63,520 SCG TOTAL $ 11,099,986 $ 5,075,222 $ 14,091,741 $ 19,368,580 $ 20,530, % 1,636,326 24,712,715 11,340 GRAND TOTAL $ 25,435,673 $ 12,416,711 $ 33,531,369 $ 48,308,245 $ 51,070, % ,738,169 57,376,731 74,859 Sub Total HES Income Eligible $ 5,276,335 $ - $ 5,276,335 $ 10,092,699 $ 11,702, % ,952 Homes 658,279 12,930,547 5,755 Sub Total Home Energy Solutions $ 7,454,636 $ 3,425,767 $ 10,880,403 $ 20,146,263 $ 21,298, % ,574 Homes 1,070,859 21,368,533 49,973 Sub Total New Construction $ 756,166 $ 602,444 $ 1,358,610 $ 1,687,434 $ 1,687, % Homes 87,776 2,194, Sub Total Water Heating $ 614,942 $ 1,794,080 $ 2,409,022 $ 1,474,341 $ 1,474, % ,560 Units 147,805 1,873, Sub Total Lost Opportunity $ 3,324,445 $ 1,296,921 $ 4,621,366 $ 6,113,888 $ 6,113, % Projects 538,785 8,275,710 4,252 Sub Total O&M $ 1,282,997 $ 2,246,374 $ 3,529,371 $ 2,935,832 $ 2,935, % Projects 568,245 3,409,468 6,256 Sub Total Small Business $ 293,177 $ 355,336 $ 648,513 $ 621,007 $ 621, % Projects 69, , CNG IT, Planning, Evaluation, and EEB $ 1,929,323 SCG IT, Planning, Evaluation, and EEB $ 1,775,242 $ 57.2% 2,110,142 39,821,055 58,394 $ 25.8% 1,628,028 17,555,676 16,

139 Table B 2015 SCG Comparison of Programs Energy Savings (cont.) Table B 2015 COMPARISON OF CONSERVATION PROGRAMS RESIDENTIAL Program Annual Cost Rate ($/ccf) Lifetime Cost Rate ($/ccf) Annualized Savings Oil (gallons) Lifetime Savings Oil (gallons) Annualize d Savings Propane (gallons) Lifetime Savings Propane (gallons) Annual MMBTU Lifetime MMBTU Cost per Annual MMBTU Cost per Lifetime MMBTU CNG HES Income Eligible $ 8.05 $ , ,555 $ $ 3.98 SCG HES Income Eligible $ 7.98 $ , ,998 $ $ 3.95 CNG Home Energy Solutions $ 7.17 $ , ,930 2,826 56,522 74,829 1,493,609 $ $ 3.18 SCG Home Energy Solutions $ 6.62 $ , ,150 $ $ 3.22 Sub Total Home Energy Solutions $ 6.96 $ , ,930 2,826 56, ,988 2,334,759 $ $ 3.19 SCG Residential Behavior $ 3.11 $ , ,641 $ $ 5.73 CNG New Construction $ 8.23 $ , ,964 $ $ 3.20 SCG New Construction $ 9.17 $ ,714 92,839 $ $ 3.56 Sub Total New Construction $ 8.61 $ , ,803 $ $ 3.35 CNG Water Heating $ 4.16 $ ,605 96,383 $ $ 3.19 SCG Water Heating $ 4.16 $ ,605 96,383 $ $ 3.19 Sub Total Water Heating $ 4.16 $ , ,767 $ $ 3.19 Subtotal Residential $ 6.45 $ , ,930 2,826 56, ,930 4,233,524 $ $ 3.44 Commercial and Industrial C&I Lost CNG Energy Conscious Blueprint $ 6.21 $ , ,512 $ $ 3.93 SCG Energy Conscious Blueprint $ 6.11 $ , ,058 $ $ 3.86 Sub Total Lost Opportunity $ 6.17 $ , ,571 $ $ 3.90 Commercial and Industrial Large Retrofit CNG Energy Opportunities $ 3.54 $ , ,135 $ $ 3.06 SCG Energy Opportunities $ 3.93 $ , ,816 $ $ 3.39 Sub Total Energy Opportunites $ 3.68 $ , ,951 $ $ 3.17 CNG O&M $ 2.17 $ , ,407 $ $ 3.51 SCG O&M $ 2.38 $ , ,427 $ $ 3.85 Sub Total O&M $ 2.26 $ , ,834 $ $ 3.66 CNG Small Business $ 4.43 $ ,860 43,498 $ $ 3.82 SCG Small Business $ 3.92 $ ,339 37,626 $ $ 3.38 Sub Total Small Business $ 4.19 $ ,200 81,123 $ $ 3.61 Subtotal Commercial & Industrial $ 4.03 $ OTHER CNG CHIF, Residential, C&I Loan Program SCG CHIF, Residential, C&I Loan Program Sub Total Other - Loan Program CNG IT, Planning, Evaluation, and EEB SCG IT, Planning, Evaluation, and EEB Sub Total Other - Evaluation Subtotal Other PROGRAM SUBTOTALS CNG Residential $ 7.29 $ , ,930 2,826 56, ,551 2,406,512 $ $ 3.41 SCG Residential $ 6.45 $ ,380 1,827,012 $ $ 3.48 Residential Total $ 6.90 $ , ,930 2,826 56, ,930 4,233,524 $ $ 3.44 CNG C&I $ 3.99 $ ,526 1,090,553 $ $ 3.58 SCG C&I $ 4.09 $ , ,927 $ $ 3.72 C&I Total $ 4.03 $ ,524 1,806,479 $ $ 3.63 CNG Other 0 0 SCG Other 0 0 CNG TOTAL $ 6.82 $ , ,930 2,826 56, ,077 3,497,064 $ $ 4.10 SCG TOTAL $ 6.78 $ ,378 2,542,938 $ $ 4.37 GRAND TOTAL $ 6.80 $ , ,930 2,826 56, ,454 6,040,003 $ $ 4.21 Sub Total HES Income Eligible $ 8.02 $ ,737 1,330,553 $ $ 3.97 Other Total

140 Table C 2014 SCG Program Budget by Category Table C SCG 2014 Budget Details GAS CONSERVATION BUDGET ($000) Labor Materials & Supplies Outside Services Incentives Marketing Administrative Expenses TOTAL RESIDENTIAL HES Income Eligible - Weatherization $ 213,070 $ 2,500 $ 50,000 $ 2,403,506 $ 9,500 $ 1,500 $ 2,680,076 Home Energy Solutions (HES) $ 268,433 $ 2,000 $ 150,000 $ 2,085,921 $ 35,000 $ 4,000 $ 2,545,354 Residential Behavior $ 10,000 $ 3,750 $ 450,050 $ - $ 75,000 $ 3,000 $ 541,800 Residential New Construction $ 30,928 $ 720 $ 24,762 $ 271,545 $ 22,080 $ 1,500 $ 351,535 Water Heating $ 14,053 $ 300 $ 2,900 $ 276,800 $ 5,000 $ 1,185 $ 300,238 Subtotal Residential $ 536,484 $ 9,270 $ 677,712 $ 5,037,772 $ 146,580 $ 11,185 $ 6,419,003 COMMERCIAL & INDUSTRIAL LOST OPPORTUNITY Energy Conscious Blueprint $ 161,852 $ 2,500 $ 50,000 $ 1,113,432 $ 25,000 $ 5,000 $ 1,357,784 Subtotal C&I - Lost Opportunity $ 161,852 $ 2,500 $ 50,000 $ 1,113,432 $ 25,000 $ 5,000 $ 1,357,784 COMMERCIAL & INDUSTRIAL LARGE RETROFIT Energy Opportunities $ 120,957 $ 2,500 $ 50,000 $ 437,905 $ 12,500 $ 5,000 $ 628,862 Operations & Maintenance $ 31,387 $ 5,000 $ 50,000 $ 382,339 $ 5,000 $ 4,000 $ 477,726 Subtotal C&I - Lost Opportunity $ 152,344 $ 7,500 $ 100,000 $ 820,244 $ 17,500 $ 9,000 $ 1,106,588 Small Business $ 23,975 $ 500 $ 5,000 $ 87,354 $ 2,500 $ 5,000 $ 124,329 Subtotal C&I $ 338,171 $ 10,500 $ 155,000 $ 2,021,030 $ 45,000 $ 19,000 $ 2,588,701 OTHER - PROGRAMS/REQUIREMENTS & PLANNING OTHER - EDUCATION SmartLiving Center - Museum Partnerships $ 7,655 $ 2,000 $ 158,178 $ 5,000 $ 500 $ 173,333 Clean Energy Communities $ 36,905 $ 106,428 $ 143,333 EESmarts/K-12 $ 8,352 $ 1,300 $ 49,015 $ 7,000 $ 1,000 $ 66,667 Customer Engagement $ - $ 50,000 $ 50,000 Subtotal Education $ 52,912 $ 3,300 $ 363,621 $ - $ 12,000 $ 1,500 $ 433,333 OTHER - PROGRAMS/REQUIREMENTS ISE $ - $ - $ 37,333 $ - $ - $ - $ 37,333 ESPC $ - $ - $ 9,600 $ - $ - $ - $ 9,600 CHIF Loan Fund $ - $ - $ 100,045 $ - $ - $ - $ 100,045 Residential Financing Subsidies $ - $ - $ 75,000 $ - $ - $ - $ 75,000 C&I Financing Subsidies $ - $ - $ 79,667 $ - $ - $ - $ 79,667 Subtotal Programs/Requirements $ - $ - $ 301,645 $ - $ - $ - $ 301,645 OTHER - RD&D Research, Development and Demonstration $ - $ - $ 50,000 $ - $ - $ - $ 50,000 Subtotal Renewables & RD&D $ - $ - $ 50,000 $ - $ - $ - $ 50,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 98,496 $ 22,833 $ 121,329 Marketing Plan $ 203,333 $ 203,333 Information Technology $ 13,321 $ 120,012 $ 133,333 Planning $ 80,000 $ - $ 80,000 Evaluation $ 20,418 $ 208,465 $ 228,883 Evaluation Consultant $ 24,297 $ 24,297 Energy Efficiency Board $ 50,210 $ 50,210 Performance Fee $ 527,978 $ 527,978 Subtotal Other $ 212,235 $ - $ 629,150 $ - $ - $ 527,978 $ 1,369,363 PROGRAM SUBTOTALS Residential $ 578,814 $ 11,910 $ 1,068,654 $ 5,037,772 $ 156,180 $ 12,385 $ 6,865,714 C&I $ 348,753 $ 11,160 $ 429,324 $ 2,021,030 $ 47,400 $ 19,300 $ 2,876,968 Other $ 212,235 $ - $ 679,150 $ - $ - $ 527,978 $ 1,419,363 TOTAL BUDGET $ 1,139,802 $ 23,070 $ 2,177,128 $ 7,058,802 $ 203,580 $ 559,663 $ 11,162,

141 Table C 2014 Pie SCG 2014 Gas Conservation Budget By Expense Class Marketing 1.8% Administrative Expenses 5.0% Labor 10.2% Materials & Supplies 0.2% Incentives 63.2% Outside Services 19.5% Expense Classes Budget % of Budget Labor $ 1,139, % Materials & Supplies $ 23, % Outside Services $ 2,177, % Incentives $ 7,058, % Marketing $ 203, % Administrative Expenses $ 559, % Total $ 11,162, % 135

142 Table C 2015 SCG Program Budget by Category Table C SCG 2015 Budget Details GAS CONSERVATION BUDGET ($000) Labor Materials & Supplies Outside Services Incentives Marketing Administrative Expenses TOTAL RESIDENTIAL HES Income Eligible - Weatherization $ 213,070 $ 2,500 $ 50,000 $ 2,278,072 $ 9,500 $ 1,500 $ 2,554,642 Home Energy Solutions (HES) $ 268,433 $ 2,000 $ 150,000 $ 2,253,757 $ 35,000 $ 2,467 $ 2,711,657 Residential Behavior $ 10,000 $ 3,750 $ 360,050 $ - $ 75,000 $ 3,000 $ 451,800 Residential New Construction $ 30,928 $ 720 $ 24,762 $ 250,800 $ 22,080 $ 1,500 $ 330,790 Water Heating $ 14,053 $ 300 $ 3,000 $ 282,400 $ 6,533 $ 1,185 $ 307,471 Subtotal Residential $ 536,484 $ 9,270 $ 587,812 $ 5,065,029 $ 148,113 $ 9,652 $ 6,356,360 COMMERCIAL & INDUSTRIAL LOST OPPORTUNITY Energy Conscious Blueprint $ 161,852 $ 2,500 $ 50,000 $ 1,082,951 $ 30,000 $ 9,500 $ 1,336,803 Subtotal C&I - Lost Opportunity $ 161,852 $ 2,500 $ 50,000 $ 1,082,951 $ 30,000 $ 9,500 $ 1,336,803 COMMERCIAL & INDUSTRIAL LARGE RETROFIT Energy Opportunities $ 120,957 $ 2,500 $ 40,000 $ 439,441 $ 12,500 $ 5,000 $ 620,398 Operations & Maintenance $ 31,387 $ 5,000 $ 50,000 $ 474,424 $ 10,000 $ 5,000 $ 575,811 Subtotal C&I - Lost Opportunity $ 152,344 $ 7,500 $ 90,000 $ 913,865 $ 22,500 $ 10,000 $ 1,196,209 Small Business $ 23,975 $ 500 $ 5,000 $ 90,442 $ 2,500 $ 4,730 $ 127,147 Subtotal C&I $ 338,171 $ 10,500 $ 145,000 $ 2,087,258 $ 55,000 $ 24,230 $ 2,660,159 OTHER - PROGRAMS/REQUIREMENTS & PLANNING OTHER - EDUCATION SmartLiving Center - Museum Partnerships $ 7,655 $ 2,000 $ 66,845 $ 5,000 $ 500 $ 82,000 Clean Energy Communities $ 36,905 $ 106,428 $ 143,333 EESmarts/K-12 $ 8,352 $ 1,300 $ 49,015 $ 7,000 $ 1,000 $ 66,667 Customer Engagement $ - $ 50,000 $ 50,000 Subtotal Education $ 52,912 $ 3,300 $ 272,288 $ - $ 12,000 $ 1,500 $ 342,000 OTHER - PROGRAMS/REQUIREMENTS ISE $ - $ - $ 37,333 $ - $ - $ - $ 37,333 ESPC $ - $ - $ 9,600 $ - $ - $ - $ 9,600 CHIF Loan Fund $ - $ - $ 99,959 $ - $ - $ - $ 99,959 Residential Financing Subsidies $ - $ - $ 86,333 $ - $ - $ - $ 86,333 C&I Financing Subsidies $ - $ - $ 75,000 $ - $ - $ - $ 75,000 Subtotal Programs/Requirements $ - $ - $ 308,225 $ - $ - $ - $ 308,225 OTHER - RD&D Research, Development and Demonstration $ - $ - $ 50,000 $ - $ - $ - $ 50,000 Subtotal Renewables & RD&D $ - $ - $ 50,000 $ - $ - $ - $ 50,000 OTHER - ADMINISTRATIVE & PLANNING Administration $ 98,496 $ 22,833 $ 121,329 Marketing Plan $ 203,333 $ 203,333 Information Technology $ 13,321 $ 120,012 $ 133,333 Planning $ 80,000 $ - $ 80,000 Evaluation $ 20,418 $ 225,299 $ 245,717 Evaluation Consultant $ 24,297 $ - $ 24,297 Energy Efficiency Board $ 50,210 $ 50,210 Performance Fee $ - $ 525,023 $ 525,023 Subtotal Other $ 212,235 $ - $ 645,984 $ - $ - $ 525,023 $ 1,383,242 PROGRAM SUBTOTALS Residential $ 578,814 $ 11,910 $ 905,601 $ 5,065,029 $ 157,713 $ 10,852 $ 6,729,919 C&I $ 348,753 $ 11,160 $ 407,724 $ 2,087,258 $ 57,400 $ 24,530 $ 2,936,825 Other $ 212,235 $ - $ 695,984 $ - $ - $ 525,023 $ 1,433,242 TOTAL BUDGET $ 1,139,802 $ 23,070 $ 2,009,309 $ 7,152,287 $ 215,113 $ 560,405 $ 11,099,

143 Table C 2015 Pie SCG 2015 Gas Conservation Budget By Expense Class Marketing 1.9% Administrative Expenses 5.0% Labor 10.3% Materials & Supplies 0.2% Incentives 64.4% Outside Services 18.1% Expense Classes Budget % of Budget Labor $ 1,139, % Materials & Supplies $ 23, % Outside Services $ 2,009, % Incentives $ 7,152, % Marketing $ 215, % Administrative Expenses $ 560, % Total $ 11,099, % 137

144 Table D SCG Historical and Projected Program Expenditures and Units Table D SCG Historical and Projected $ and Units RESIDENTIAL Expenditures $ (000) Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal HES Income Eligible - Weatherization $ 251 $ 344 $ 492 $ 1,350 $ 948 $ 2,056 $ 1,766 $ 3,816 $ 2,680 $ 2,555 Home Energy Solutions (HES) $ 42 $ 193 $ 670 $ 540 $ 1,296 $ 1,402 $ 1,285 $ 1,666 $ 2,545 $ 2,712 Residential Behavior $ - $ - $ - $ - $ - $ - $ - $ - $ 542 $ 452 Residential New Construction $ - $ - $ - $ 188 $ 94 $ 365 $ 120 $ 596 $ 352 $ 331 Water Heating $ - $ - $ 48 $ 91 $ 73 $ 40 $ 54 $ 39 $ 300 $ 307 Subtotal Residential $ 292 $ 537 $ 1,211 $ 2,169 $ 2,411 $ 3,862 $ 3,224 $ 6,117 $ 6,419 $ 6,356 COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint $ - $ - $ 657 $ 606 $ 624 $ 1,090 $ 1,351 $ 697 $ 1,358 $ 1,337 Total - Lost Opportunity $ - $ - $ 657 $ 606 $ 624 $ 1,090 $ 1,351 $ 697 $ 1,358 $ 1,337 C&I LARGE RETROFIT Energy Opportunities $ - $ - $ 60 $ 185 $ 84 $ 1,037 $ 169 $ 835 $ 629 $ 620 O&M (RetroCx, Training) $ - $ - $ 9 $ 3 $ 8 $ 251 $ 2 $ (20) $ 478 $ 576 Total - C&I Large Retrofit $ - $ - $ 70 $ 188 $ 93 $ 1,288 $ 171 $ 815 $ 1,107 $ 1,196 Small Business $ - $ - $ - $ - $ - $ - $ 92 $ 92 $ 124 $ 127 Subtotal C&I $ - $ - $ 726 $ 794 $ 716 $ 2,378 $ 1,613 $ 1,604 $ 2,589 $ 2,660 PROGRAM SUB-TOTALS Residential $ 292 $ 537 $ 1,211 $ 2,169 $ 2,411 $ 3,862 $ 3,224 $ 6,117 $ 6,419 $ 6,356 C&I $ - $ - $ 726 $ 794 $ 716 $ 2,378 $ 1,613 $ 1,604 $ 2,589 $ 2,660 TOTAL $ 292 $ 537 $ 1,937 $ 2,963 $ 3,127 $ 6,240 $ 4,838 $ 7,721 $ 9,008 $ 9,017 RESIDENTIAL Units Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal HES Income Eligible - Weatherization ,910 3,511 2,034 3,268 2,479 3,647 4,080 3,867 Home Energy Solutions (HES) ,149 1,421 2,538 2,369 2,049 2,619 3,402 3,638 Residential Behavior ,500 2,500 Residential New Construction Water Heating ,280 2,280 Subtotal Residential ,168 5,269 4,840 5,986 4,648 6,537 12,409 12,418 COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint Total - Lost Opportunity C&I LARGE RETROFIT Energy Opportunities O&M (RetroCx, Training) Total - C&I Large Retrofit Small Business Subtotal C&I PROGRAM SUB-TOTALS Residential ,168 5,269 4,840 5,986 4,648 6,537 12,409 12,418 C&I TOTAL ,181 5,299 4,895 6,046 4,805 6,743 12,468 12,

145 Table D1 SCG Historical and Projected Annual and Lifetime CCF Table D SCG Historical and Projected Annual and Lifetime ccf RESIDENTIAL Annual ccf (000) Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal HES Income Eligible - Weatherization Home Energy Solutions (HES) Residential Behavior Residential New Construction Water Heating Subtotal Residential COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint Total - Lost Opportunity C&I LARGE RETROFIT Energy Opportunities O&M (RetroCx, Training) Total - C&I Large Retrofit Small Business Subtotal C&I PROGRAM SUB-TOTALS Residential C&I TOTAL ,220 1,554 1,589 1,636 RESIDENTIAL Lifetime ccf (000) Actual Actual Actual Actual Actual Actual Actual Actual Goal Goal HES Income Eligible - Weatherization ,965 3,551 5,637 4,942 13,533 6,634 6,288 Home Energy Solutions (HES) ,793 3,239 5,472 4,180 4,359 5,613 7,658 8,174 Residential Behavior ,454 1,454 Residential New Construction Water Heating Subtotal Residential 860 1,488 3,887 12,035 9,545 10,680 9,600 19,739 17,671 17,755 COMMERCIAL & INDUSTRIAL Energy Conscious Blueprint - - 1,907 2,009 3,152 2,555 5,325 4,484 3,458 3,363 Total - Lost Opportunity - - 1,907 2,009 3,152 2,555 5,325 4,484 3,458 3,363 C&I LARGE RETROFIT Energy Opportunities ,834 3,087 2,322 1,770 1,777 O&M (RetroCx, Training) ,560 1,452 Total - C&I Large Retrofit ,638 3,394 2,752 3,331 3,229 Small Business Subtotal C&I - - 2,102 2,638 3,579 5,193 9,097 7,388 7,142 6,957 PROGRAM SUB-TOTALS Residential 860 1,488 3,887 12,035 9,545 10,680 9,600 19,739 17,671 17,755 C&I - - 2,102 2,638 3,579 5,193 9,097 7,388 7,142 6,957 TOTAL 860 1,488 5,989 14,674 13,124 15,873 18,697 27,127 24,812 24,

146 Incentive $ Earned SCG Performance Incentive 2014 SOUTHERN CONNECTICUT GAS COMPANY 2014 Management Incentive Performance Indicators and Incentive Matrix Provided below is the 2014 Incentive Matrix with Performance Indicators. The Utility Performance Incentive is $527,978 This calculated is based on achieving 100% of all performance targets and earning a target incentive of 5% of C&LM budgets (not including ECMB costs, Audit Costs or Management Incentive). Goals will be prorated based on actual over/under spend of budget. The actual incentive earned will be determined by the performance achieved in each of the Incentive Metrics identified below, based on the following Performance Index: Incentive $ Earned vs Performance Achieved Performance % Pretax Incentive Pre-tax Incentive $1,500,000 $1,300,000 $1,100,000 $900,000 $700,000 $500,000 $300,000 $100, % $263, % $316, % $422, % $527, % $633, % $739, % $844, Performance Achieved % of Target Total Original Budget* $10,559,560 *Does not include Incentive, ECMB costs and Audit 140

147 SCG Performance Incentive 2014 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive Residential Program Budgets $ 6,419,003 Lifetime Savings (ccf): HES Income Eligible 6,633,849 Total Gas Benefit from all Residential programs Gas Benefit from all Residential programs $14,352, $102,956 Home Energy Solutions 7,658,261 Residential Behavior 1,454,241 New Construction 987,584 Water Heating 936,671 Total Lifetime Savings (ccf) 17,670,606 Present Value Lifetime Savings (ccf) $ Total Residential Gas Benefit: $14,352,103 Net Residential Gas Benefit: Number of Water Heating Units (tankless and condensing) per DEEP Final Water Heating $ 300,238 Number of Units $5,280 Decision HES $ 2,545,354 Achieve ccf savings per single family home ccf/home $26,399 HES-IE $ 2,680,076 Annual ccf savings Annual ccf savings 337, $15,839 $7,933,100 $7,933, $102,

148 SCG Performance Incentive 2014 (cont.) SECTOR Program Performance Indicators C&I Program Budgets $ 2,588,701 Lifetime Savings (ccf): Energy Conscious Blueprint 3,457,711 Energy Opportunities 1,770,426 O&M 1,560,393 Small Business 353,167 Total Lifetime Savings (ccf) 7,141,697 Present Value Lifetime Savings (ccf) $ Total C&I Gas Benefit: $5,824,187 Small Business $ 124,329 Number of gas projects that are comprehensive or implement measure bundles or Number of projects that consist of at least two gas measures Comprehensive is defined as 1. More than one End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, and involves an End Use with a natural gas measure. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings Only SBEA projects are eligible Calculations based on signed projects with gas, no Rebates: [ (# of signed projects with gas - any rebate projects) / (total # of signed SBEA projects with gas - any rebate projects)] Small Business projects may also be comprehensive by utilizing bundled measures. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Energy Star Natural Gas or Electric Dishwashers. Incentive Metrics Incentive Metric Target Goal Weight Incentive Total Gas Benefit from all C&I programs Gas Benefit from all C&I programs $5,824, $110,875 % of Gas Projects 10% of signed projects $15,839 Net C&I Gas Benefit: $3,235,486 $3,235, $110,

149 SCG Performance Incentive 2014 (cont.) SECTOR Program Energy Blueprint / Energy Opportunities Manufacturing Customer Projects Total Incentive $ Residential and C&I Performance Indicators Percentage of signed gas only projects containing multiple measures Projects must fall within Energy Opportunities or Energy Conscious Blueprint programming; Projects must contain multiple gas measures; No restriction to the number of enduses; No SBEA projects are included, Calculations based on signed projects, no Rebates: [ (# of signed projects - rebate projects) / (total # of signed projects from all large C&I - all rebate projects)] Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the gas energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] Incentive Metrics Incentive Metric Target Goal Weight Incentive % of Gas Projects 15% of signed projects $15,839 % of Savings Via Signed Contracts 20% of Savings Via Signed Contracts $21, $527,

150 Incentive $ Earned SCG Performance Incentive 2015 SOUTHERN CONNECTICUT GAS COMPANY 2015 Management Incentive Performance Indicators and Incentive Matrix Provided below is the 2015 Incentive Matrix with Performance Indicators. The Utility Performance Incentive is $525,023 This calculated is based on achieving 100% of all performance targets and earning a target incentive of 5% of C&LM budgets (not including ECMB costs, Audit Costs or Management Incentive). Goals will be prorated based on actual over/under spend of budget. The actual incentive earned will be determined by the performance achieved in each of the Incentive Metrics identified below, based on the following Performance Index: Performance % Pretax Incentive Pre-tax Incentive % $315, % $420, % $525, % $630, % $735, % $840,036 $1,500,000 $1,300,000 $1,100,000 $900,000 $700,000 $500,000 $300,000 $100,000 Incentive $ Earned vs Performance Achieved Total Original Budget* $10,500,456 Performance Achieved % of Target *Does not include Incentive, ECMB costs and Audit 144

151 SCG Performance Incentive 2015 (cont.) SECTOR Program Incentive Metrics Performance Indicators Incentive Metric Target Goal Weight Incentive Residential Program Budgets $ 6,356,360 Lifetime Savings (ccf): HES Income Eligible 6,287,642 Total Gas Benefit from all Residential programs Gas Benefit from all Residential programs $13,946, $102,379 Home Energy Solutions 8,174,441 Residential Behavior 1,454,241 New Construction 902,223 Water Heating 936,671 Total Lifetime Savings (ccf) 17,755,217 Present Value Lifetime Savings (ccf) $ Total Residential Gas Benefit: $13,946,113 Net Residential Gas Benefit: Number of Water Heating Units (tankless and condensing) per DEEP Final Water Heating $ 307,471 Number of Units $5,250 Decision HES $ 2,711,657 Achieve ccf savings per single family home ccf/home $26,251 HES-IE $ 2,554,642 Annual ccf savings Annual ccf savings 320, $15,751 $7,589,753 $7,589, $102,

152 SCG Performance Incentive 2015 (cont.) SECTOR Program Performance Indicators C&I Program Budgets $ 2,660,159 Lifetime Savings (ccf): Energy Conscious Blueprint 3,363,054 Energy Opportunities 1,776,636 O&M 1,452,156 Small Business 365,652 Total Lifetime Savings (ccf) 6,957,498 Present Value Lifetime Savings (ccf) $ Total C&I Gas Benefit: $5,422,468 Small Business $ 127,147 Number of gas projects that are comprehensive or implement measure bundles or Number of projects that consist of at least two gas measures Comprehensive is defined as 1. More than one End-Use, where End-Use is defined as Heating, Cooling, Lighting, Process, Refrigeration or EMS, and involves an End Use with a natural gas measure. 2. No 1 single End-Use can have more than 85% of the energy savings value of the total annual energy savings Only SBEA projects are eligible Calculations based on signed projects with gas, no Rebates: [ (# of signed projects with gas - any rebate projects) / (total # of signed SBEA projects with gas - any rebate projects)] Small Business projects may also be comprehensive by utilizing bundled measures. Bundled measures shall be defined generally as a list of measure types geared toward customer type categories. For example, the measure bundle for restaurants and commercial kitchens should include, but not be limited to, Lighting, Energy Star Natural Gas or Electric cooking equipment, CEEE rated Pre-Rinse Spray Valves, Energy Star Natural Gas or Electric Dishwashers. Incentive Metrics Incentive Metric Target Goal Weight Incentive Total Gas Benefit from all C&I programs Gas Benefit from all C&I programs $5,422, $110,255 % of Gas Projects 12% of signed projects $15,751 Net C&I Gas Benefit: $2,762,309 $2,762, $110,

153 SCG Performance Incentive 2015 (cont.) SECTOR Program Energy Blueprint / Energy Opportunities Manufacturing Customer Projects Total Incentive $ Residential and C&I Performance Indicators Percentage of signed gas only projects containing multiple measures Projects must fall within Energy Opportunities or Energy Conscious Blueprint programming; Projects must contain multiple gas measures; No restriction to the number of enduses; No SBEA projects are included, Calculations based on signed projects, no Rebates: [ (# of signed projects - rebate projects) / (total # of signed projects from all large C&I - all rebate projects)] Energy savings from Signed Manufacturing Customer projects. Energy Savings includes the gas energy savings from all end uses. Manufacturing customer projects of any size including those that are < 200 kw, Manufacturing customer is any with a NAICS manufacturing code or, Manufacturing projects within the following facility types from the tracking systems: industrial 1 shift, industrial 2 shift, industrial 3 shift, manufacturing or lite manufacturing. Calculations based on signed contracts, no Rebates: [ (Savings from manufacturing Customers projects - savings from rebates) / (total savings from all C&I - savings from all rebates)] Incentive Metrics Incentive Metric Target Goal Weight Incentive % of Gas Projects 17% of signed projects $15,751 % of Savings Via Signed Contracts 22% of Savings Via Signed Contracts $21, $525,

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155 CHAPTER THREE: RESIDENTIAL PROGRAMS (Electric and Natural Gas) Residential Retail Products (Electric) Overview The objective of the Residential Retail Products Program ( Retail Program ) is to increase consumer awareness, acceptance and market share of ENERGY STAR lighting, appliances and consumer electronics. To date, the Retail Program has been the model market transformation program within the residential portfolio. Incentives are offered through three different vehicles including upstream payments to manufacturers, instant coupons and mail-in rebates. Providing incentives upstream through the Negotiated Cooperative Promotion ( NCP ) enables consumers to pay a discounted price at the point-of-purchase; thus reducing overall program expenses by reducing redemption costs and simplifying the consumer s purchasing experience. Additionally, the Companies influence a large portion of the total market through fewer communication points while impacting the greatest number of purchase decisions. This strategy allows for incentives to have a greater impact when applied at the wholesale versus retail level. Summary of 2014 Program Changes The 2014 Retail Lighting objectives are to increase the market penetration of LEDs and provide enhanced consumer education and awareness about efficient lighting. These objectives are based upon the understanding that the retail lighting market is rapidly evolving: There is increased consumer awareness and acceptance of Compact Fluorescent Lamps ( CFLs ) coupled with an increased demand for LEDs, driven by the rapidly declining price of many LED products and adoption of LED technology becoming more mainstream. However, despite declining LED costs, they are still typically significantly more expensive than comparable incandescent or CFL technologies. At the same time, lighting products manufactured to comply with recently implemented Federal standards under the Energy Independence and Security Act of 2007 ( EISA ) are becoming available. The 2014 Retail Program will continue to focus on increasing socket penetration of efficient lighting products in homes, including CFLs but with a specific and enhanced focus on LEDs, as well as enhanced consumer education and awareness about efficient lighting choices, technologies, features and benefits. The Retail Program budget for 2014 and 2015 has therefore been increased to address the factors noted above including the higher cost for LED technologies. Marketing, Outreach and Education Overall, the consumer outreach of the Retail Program will be greatly increased in The Companies will expand education and targeted messaging to better inform consumers 149

156 about their efficient lighting options. Increased educational efforts about the diversity of efficient lighting options, the impact of EISA standards, dimmer compatibility, and the meaning of terms like lumens, cool white, warm white, etc. Visual and hands on displays will be utilized to help educate customers about the various efficient lighting options that are available. The Companies will better target the hard to reach market segments that have not yet replaced incandescent bulbs throughout their home, including but not necessarily limited to elderly, low-income and bi-lingual customers through increased education and awareness. Education will be increased at the point-of-purchase during high-traffic periods and at as many participating locations as possible, including in-store promotions to capture customer attention. The Companies will leverage the industry by encouraging retailers to include instore promotions and marketing as part of the value of NCPs. The Companies will work closely with retail store managers to inform them about the benefits of the program, and to offer additional training to retail staff about lighting technology. Improvements may include developing handouts for retail staff and customers (e.g. tear pad, pamphlet, retailer pocket guides) and working to creatively enhance retailer training experience and reduce training material printing cost through electronic media. ENERGY STAR and TopTen Appliances The Companies will work with their respective marketing departments and industry partners to develop strong appliance and consumer electronics collateral and to provide better storelevel messaging about the benefits of ENERGY STAR and TopTen certified products. The Companies will continue to support TopTen by providing education on efficient products to customers through the Connecticut TopTen website ( and will continue to offer rebates for refrigerators, freezers and washers that meet TopTen criteria as well as an upstream rebate for heat pump water heaters. The Companies will also increase outreach to gas conversion customers to encourage weatherization and the installation of high-efficiency natural gas measures including water heaters, furnaces and boilers. Focus on LEDs The Retail Program will focus on providing incentives and marketing support for ENERGY STAR-certified LED bulbs and fixtures with the goal of increasing the sales of these products. Incentives will not be offered for dimmable CFLs. Incentive levels will be adjusted downward as competition transforms the market and retail price points decline. In addition, the Companies will work with their lighting events vendor to improve corporate and community lighting events, increase LED offerings and enhance the educational value to consumers. 150

157 The Companies will continue to closely monitor the LED and CFL markets. Future C&LM Plans will be guided by the latest market data and evaluation and study results Incentive Levels The Companies are refining incentives to help impact the sale of LEDs, while strategically monitoring and adjusting incentives of CLFs downward such that they remain competitive compared to their ESIA compliant alternatives. In order to adapt to rapidly changing market conditions, the Companies must have the flexibility to change rebate levels throughout the year as needed. This is particularly important in the Retail Program because the LED market and retail pricing is evolving very quickly. In 2014, incentives will continue to be offered using mail-in rebates and NCPs. Mail-in rebates will be offered for various ENERGYSTAR certified LED bulbs, downlights and fixtures, as well as ENERGY STAR certified CFL bulbs and fixtures. NCP incentives are offered for general and non-general service CFLs, CFL fixtures, general and non-general service specialty or non A-line style, LEDs and LED fixtures. Incentives have been removed from dimmable CFLs. Rebate levels may be subject to change throughout the year based on market conditions and budget expenditures. Incentives will also be offered for TopTen Products including refrigerators, freezers, washers and heat pump water heaters. 151

158 Residential New Construction (Electric and Natural Gas) Overview The objective of the electric and natural gas Residential New Construction ( RNC ) program is to reduce the energy use and peak demand in new housing. Related objectives include increasing builder and consumer awareness of energy-efficient building practices, and to affect permanent market movement to more energy-efficient residential new construction in the State of Connecticut. In 2013, the Companies offered a variety of incentives for new homes. A tiered rebate structure existed depending upon what Home Energy Rating System ( HERS ) Index value was achieved. Additionally, homes that reached ENERGY STAR certification could also obtain a bonus certification incentive for one of three approved certification programs, an additional low load homes incentive if a single family dwelling met the requirements, and various prescriptive incentives depending upon the thermal insulation, mechanical systems, and appliances installed. Homes heated with fuel oil and propane were only eligible for 30% of the listed incentives. Homes heated with natural gas were eligible for 100% payment for the ENERGY STAR and additional bonus certifications. Non-ENERGY STAR homes/units such as gut rehabilitation projects and homeowners/builders who choose not to build an ENERGY STAR home were entitled to prescriptive measure incentives on a per-measure basis for high performance insulation, heating, cooling, hot water system equipment, and specific TopTen appliances. Summary of 2014 Program Changes The Decision required the LDCs to make changes to the RNC program in order to make the program more cost effective. The Companies determined the best approach to be an adjustment of the RNC program requirements and incentives across all Companies in 2014 in order to improve cost effectiveness as a whole. In conjunction with this is our objective to offer a HERS Index path designed to help Connecticut builders become familiar with building practices that are going to be required once Connecticut adopts the 2012 International Energy Conservation Code ( 2012 IECC ). The 2012 IECC incorporates the HERS Rating index as an optional compliance path. In 2014, the Companies propose two separate Tracks : The HERS Index (Track 1) and the Prescriptive Path (Track 2), both of which require the home owner to hire a HERS rater. This streamlined approach aims to reduce costs and increase cost effectiveness. Track 1, The HERS Index path, is an ideal path for all ground-up construction projects as well as gut-rehabilitation projects, as a HERS Rating can be performed on any age and size 152

159 residential structure. In this Track a certified HERS Rater designates an official HERS Index rating for the home/unit. The Companies propose the following tiered incentive structure for Track 1: Tier 2013 ENERGY STAR HERS Index 2014 Proposed HERS Index <50 4 <50 - As part of Track 1, the Companies propose to offer ENERGY STAR as a bonus incentive. With the change in the ENERGY STAR program to version 3.0, many builders around the country including Connecticut have stopped participating in ENERGY STAR due to an increase in the expense and complexity involved in meeting version 3.0 criteria. The Companies believe that offering a HERS Index path will help move the construction market towards future 2015 IECC compliance while also providing valuable contractor construction practice education through hiring HERS Raters. HERS Raters often offer needed advice to contractors during construction to achieve better HERS Index scores. The Companies propose to remove the Rating Incentive that existed in the 2013 program, since no actual energy savings are tied to hiring a HERS Rater. The Companies will also remove the low load home bonus incentive from the 2014 program. In lieu of that, the Companies plan to continue to offer a bonus incentive for Leadership in Energy & Environmental Design ( LEED ), DOE Challenge Home, or National Green Building Standard ( NGBS ) certification in the 2014 program as long as the home also meets ENERGY STAR v 3.0. Track 2 is the Prescriptive Path. This path will be available for any homes that choose not to hire the full services of a HERS Rater, however they do require a HERS rater to inspect that insulation was installed to RESNET Grade 1 standard and to verify the home s air tightness using a blower door test. The prescriptive HVAC and appliance rebates will be removed, with the exception of the geothermal rebate. In order to get the geothermal rebate the customer will need to go through RNC Track 1 or Track 2. The companies are also working with Residential Energy Services Network ( RESNET ) and the industry approved modeling software called REM/Rate to give more credit for LED lighting in a HERS rating and modeling software. 153

160 In addition, delivered fuel homes will also be eligible for 100% of the listed incentives based upon the treatment of all fuels in the Decision and the anticipated cost effective savings. The Companies will continue to promote the use of efficient lighting in new construction by requiring that at least 80% of the sockets contain either LEDs or CFLs, adhering to the Energy Star requirement. The Companies also plan to continue to offer an income eligible bonus incentive of 25% greater than listed incentives for dwellings that will house limited income customers. Finally, the companies also plan to research the feasibility of incorporating renewable-readiness criteria into future iterations of the RNC program. 154

161 Home Energy Solutions Program Overview HES is the flagship residential retrofit program serving all existing residential structures including single and multi-family properties. The objective of the HES program is to reduce total residential energy use through the comprehensive treatment of all single-family and multifamily residential dwellings, to make utility bills more affordable, to make homes more energyefficient and comfortable, to provide energy efficiency education to raise customer awareness of conservation and to encourage those customers to take behavioral and other steps beyond weatherization. For income eligible customers specifically, the Home Energy Solutions Income Eligible ( HES-IE ) program seeks to reduce their energy cost burden. HES and HES-IE will be the primary vehicle which will be used to fulfill the State of Connecticut s goal of weatherizing 80% of existing homes by 2030 per Public Act No.11-80, Section 33. In order for Connecticut to achieve the desired outcome of increased energy efficiency, the Companies will need to achieve significant levels of program participation. To obtain these results, the Companies will need to develop messaging to consumers about the importance of energy efficiency and living in a high performance home. To that end, the Companies will seek to engage market actors in the residential arena and work to increase contractor participation in the Home Performance path of HES. In addition, the Companies will continue to support the growth of a robust Home Performance with Energy Star program. In 2013, CEEF and the Companies won a prestigious ENERGY STAR partner of the Year award for its commitment to Home Performance. They also engaged with contractors through focus groups and other meetings in order to better understand the market opportunities and constraints for the Home Performance path. The Companies will build upon their current successes and lessons learned, to continue promoting the program to both existing HES contractors and outside contractors in an effort to increase participation in the Home Performance path. As the Companies begin to build awareness of the importance of having a high performance home and drive demand for a variety of energy efficiency services from the marketplace, it is critical that Connecticut develop a license for residential energy efficiency work. Absent a formal program where there is oversight and quality control built into the program, consumers may have a real or perceived trust issue with vendors attempting to sell them services they may not be able to see. The potential for unscrupulous contractors preying on unsuspecting consumers will also exist. The Companies look forward to working with DEEP and other State agencies to develop a licensing requirement for residential energy efficiency. Through the creation of a self-policing industry, the stakeholders can begin the transition of the program offerings to a more market based collection of offerings. 155

162 In addition to the HES affiliated rebates, stand-alone HVAC and retrofit geothermal equipment, natural gas water heaters and heat pump water heaters, and HVAC Quality Installation and Verification ( QIV ) rebates are included under HES. Summary of 2014 Program Changes The Companies and LDCs took into consideration several factors when developing 2014 program changes; including directives from the Decision. Our key objectives for the 2014 program year include continuing to promote the adoption of deeper measures and savings for all fuels, promoting LED technology, educating consumers about the concept of home performance, and leveraging our state-of-the-art mobile field tool. Collectively the programmatic changes proposed will put us firmly on a path toward market transformation of the Home Performance industry in Connecticut. Public Act No required that 80% Connecticut homes are weatherized. A draft definition of weatherized was developed by the Companies and the EEB, and is currently being used in an evaluation of Connecticut single family homes. The definition is asset based, based on the physical attributes of the home rather than actual energy consumption. Draft results of this evaluation were released in September 2013 and a second phase is being planned. One challenge, based on findings from the draft weatherization study, will be further insulating homes that have some (but not sufficient) insulation as it appears that many homes in Connecticut do not meet the weatherization criteria, based upon a prescriptive path. The existence of some insulation in many of these homes increases customer pay-backs and reduces program cost effectiveness while poorly insulated homes (homes with little or no insulation) can be addressed cost effectively to meet the weatherization goal through a prescriptive path. The Companies await the second phase of the weatherization baseline study and input from DEEP which will examine the cost effective potential for homes. Specifically, the second phase will provide guidance on the appropriateness of modifying the weatherization definition based on cost effectiveness criteria. The final developed definition of weatherization and subsequent rating process will help meet this challenge. The Companies believe that it is prudent to develop a streamlined rating process to determine whether a home is weatherized. The streamlined process must allow for flexibility to reflect the diversity of homes, yet not entail a time consuming and expensive rating process. A ratings system similar to the DOE Home Energy Score may meet these requirements. Program Savings and Accounting HES will use a modified utility cost test to capture the benefits from delivered fuels savings achieved through the program (refer to Chapter Seven of the Plan on Cost Effectiveness Testing). In addition, the cost-shares between electric and gas companies for gas heated homes have been updated based on an allocation to gas or electric utility based upon the benefits. Developing the process to handle budget allocation of gas conversion customers and subsidy of 156

163 fuel oil customers once the Regional Greenhouse Gas Initiative ( RGGI ) has been exceeded was developed to allocate the cost of serving oil and propane customers equitably amongst all utilities as directed by DEEP. The companies will track the customers that convert to gas during the calendar year and/or receive a natural gas equipment rebate. The information will then be cross referenced to see if those customers participated in HES and, if so, reallocate the cost and savings to the gas companies. With regards to funding fossil fuel measures once RGGI has expired, 50% of the oil/propane costs will be allocated to the electric companies and 50% will be allocated to the gas companies. For CL&P customers, the 50% gas allocation will be split: 25% YGS, and 25% CNG. For UI customers, the 50% gas allocation will be 100% to SCG. The costs and savings are reflected in Table Bs. Lighting Incentive Strategy A new lighting incentive structure will be deployed in 2014 to help shift the residential lighting retrofit market from predominantly CFL based to LED based. The Companies issued a Request for Information ( RFI ) in late 2013 in order to better understand the pricing for LEDs and the feasibility moving more LEDs within the HES program. Based on the responses received through the RFI process, the Companies not only lowered co-pays but also plans to offer a prescribed amount of LEDs at no additional charge to customers through the HES program. Pricing is being finalized through a formal Request for Proposal ( RFP ) to distributors, and pricing will be extended to HES contractors by the second quarter of Customers will receive a small amount of courtesy LEDs through the program in order to have LED technology more prevalent in CT homes and increase awareness of and satisfaction with the technology changes include: Reducing the number of free CFLs per home and adding a cap for CFL specialty bulbs. Removing dimmable CFLs from the HES program. Provide each HES customer a prescribed amount of general service LEDs and LED downlights to replace existing incandescent bulbs (actual number to be determined based on a 2014 LED RFP.) Additional direct installation of LEDs will be available to customers for a cost-share (co-pay), with no cap on the amount installed other than the number of sockets in the home. Insulation Incentives With the preliminary results of the Draft Connecticut Weatherization Baseline Assessment, there is a significant opportunity to address unconditioned, un-insulated basements. For 2014, a floor insulation incentive is being added to the existing insulation incentive. Floor insulation (over unconditioned basements and attached garages) incentive available for existing unconditioned basements or attached garages that have less than an R-6 157

164 installed, and must install R-19 or higher to qualify, and if no insulation is present, customer must install R-13 to qualify. Ceiling insulation the existing conditions for ceiling insulation will be changed. Previously, all homes with R-30 or less qualified for an incentive; now homes with R-19 or less will qualify. Financing For UI customers, the comprehensive, low-interest energy efficiency financing program will be funded and available, enabling the financing option to be consistent statewide. 2.99% on-bill financing available to HES customers who finance two or more qualifying measures with a total project cost greater than $3,000 but less than $25,000. Home Energy Score and Marketing Home Performance In the Decision, The Companies were directed to implement The DOE s Home Energy Score within HES by June of The DOE Home Energy Score is a residential asset label that will be deployed through the HES program in 2014 and it will be a significant step toward educating customers about a whole home approach to home performance. It will also help drive the Companies toward a future state, market-based approach to home performance. The launch of the label will incorporate the following milestones: All lead HES technicians will be required to become Qualified Assessors under the Home Energy Score program; this requires passing a two part proctored exam. The labeling program will be soft-launched in June of Messaging around building labeling will be tested in 2014 with existing messaging for the HES program. Comprehensive and strategic marketing planning is underway for In conjunction with the DOE Energy Score launch, the Companies 2014 marketing efforts will focus broadly on educating residents about the concept of Home Performance so that residents understand the value of these services, including health, safety, comfort and savings. Strategic planning will rely on several very important factors, including the HES program evaluation, as well as a customer segmentation study which will allow targeted customer profiling for future marketing efforts. These factors combined will allow for the deployment of enhanced marketing initiatives around home performance in HVAC Rebates In 2014, the Companies will continue offering rebates for high efficiency HVAC equipment, including central air conditioning, air source heat pumps, ductless heat pumps, furnaces, boilers 158

165 and water heaters. These rebates may be offered as part of HES or as stand-alone rebates. The 2014 HVAC changes are summarized below: Removal of Early Retirement Incentives Early retirement options were eliminated in 2014 for all natural gas boilers and furnaces as well as electric ducted equipment. This was due to a lower-than-anticipated realized energy savings. Furnace Qualification Criteria-The current minimum efficiency requirements for high efficiency furnaces will be simplified. Current rebate language reflects Consortium for Energy Efficiency ( CEE ) requirements of Tier II, furnace fan efficiency e less than or equal to 2%, which were made prior to ENERGY STAR s last specification guidelines. Since ENERGY STAR now requires this same specification, the Companies can now remove the CEE specification language from our requirement, to simply state ENERGY STAR qualified equipment. Upstream Promotion Third quarter 2013 began the Companies movement of the natural gas boiler and natural gas domestic water heaters to an upstream rebate redemption initiative, instead of the traditional downstream consumer mail-in rebate. The Companies are going to push for more upstream rebate redemption distributor participation throughout At the end of 2013, two distributors were working with the Companies to offer the upstream rebate. With increased natural gas and electric HVAC and water heating goals for 2014, additional measures will need to be incorporated into the upstream promotion soon. Customer mail-in rebates will only be available to customers who did not participate in the upstream rebate promotion. o o Outdoor Temperature Reset: With the removal of early retirement measures, in 2014 a new measure added to the HES program to gain increased savings per home is the outdoor temperature reset measure available for existing natural gas boilers within a certain age. Findings show that many boilers over five years of age do not have an outdoor temperature reset installed. Circulator Pump: Efficient water pumps utilize Electrically Commutate Motor ( ECM ) technology to circulate water in water-based heating systems more efficiently. This measure is specifically related to any fuel type boiler because the measure will realize electric savings. Many fuel oil and propane boiler customers in Connecticut are not able to receive a rebate related to replacing their equipment. As a result, this measure is a way to capture greater electric savings per home regardless of boiler fuel type. Ductless Heat Pump Program The Companies are working to determine the best process to engage electric resistance customers into installing a ductless split heat pump. The 2013 program required a HES assessment prior to the installation, and the customer only had

166 days after HES to complete the install. This limited previous HES customers and customers who take longer than 120 days to install the equipment. The HES participation requirement is being removed in 2014 to allow greater participation from electric resistance customers. In addition, it is anticipated that a significant number of oil and propane heat customers, especially those not located on existing gas mains, will switch to electric heat. To address this, the Companies will increase the ductless heat pump rebate for fossil fuel heat homes. In 2013, electric heat customers installing a qualified ductless heat pump received a $1,000 incentive, while the fossil fuel heat rebate was $250. In 2014 and 2015, the Companies will offer a $1,000 incentive for all qualifying high efficiency ductless heat pump units. Other Notes UI and CL&P are going to evaluate alternative methods for implementing a Quality Installation and Verification ( QIV ) program during Alternatives to evaluate include adopting the ENERGY STAR Verified Installation ( ESVI ) which is set to launch in 2014 as well as reevaluate how the QIV program incentives are applied to insure an adequate incentive is in place for the contractor to participate. 160

167 Water Heating Program Overview The objective of the Companies Residential Water Heating Program is to encourage customers to purchase and install high-efficiency natural gas domestic water heaters, including on-demand tankless water heaters and high efficiency storage water heaters. For electric water heating, this program promotes the purchase and installation of electric heat pump domestic water heaters as a high efficiency option. As part of Connecticut s Comprehensive Energy Strategy ( CES ) there is an emphasis to convert fuel oil heat customers to natural gas. A direct benefit to customers with this strategy is the opportunity that also exists with domestic hot water conversions through natural gas expansions. In October, the Decision set forth the following unit goals for the LDC s: DEEP Final Decision Requirement (# of Units) Summary of 2014 Program Changes Because DEEP has added a water heating goal based on units in addition to the energy savings goals and cost effectiveness goals, the program design change is to maximize the number of units and promote efficiency in all viable technologies. In addition, the LDC s will increase outreach to gas conversion customers to encourage the purchase and installation of a highefficiency natural gas water heater. Lastly, solar thermal water heating technology is being explored as an economically viable option for residential customers including multi-family facilities. If it is found to be cost effective, a residential solar thermal offering may be developed and offered to residential customers. According to ENERGY STAR s 2011 market share report, only 6% of the tankless and storage tank market currently installs ENERGY STAR qualified water heaters. While the market share percentage of tankless water heaters has grown in recent years, it is estimated to be a very small part of the existing water heating market with stand-alone storage tanks dominating. Therefore, the program will be expanded to include ENERGY STAR natural gas (non-condensing) storage water heaters at 0.67 EF (ENERGY STAR threshold), tankless (0.82 EF and greater), and condensing water heaters. 161

168 It is difficult to predict participation levels because the program is moving to an upstream model and the inclusion of storage water heaters could boost participation dramatically based on their lower incremental cost. The Companies believe that the redesigned program should provide greater market penetration for high efficiency domestic water heaters. Therefore, the LDC s strive to increase participation goals above the mandated levels in the Decision for 2014 and meet the intent of this of this new goal of by increasing the promotion of efficiency in all viable technologies. Goals for 2015 will be addressed during the course of 2014 as more information becomes available on the implementation of the increased Federal Standards in Upstream Promotion with Distributors In October 2013, the Companies launched an upstream promotion with a Connecticut supply house. The consumer mail-in rebate for natural gas water heaters was converted into an instant discount activated at the point of sale. The objective of an upstream promotion is to ensure that high-efficiency equipment is stocked at the distributor level thereby influencing the contractor when purchasing for the customer. By mitigating the incremental cost between low and high efficiency equipment, the contractor has an opportunity to upsell energy-efficient equipment to the customer at a discounted rate. Licensed contractors are not required to submit an inspection report to be eligible for the instant discount. Where appropriate, the Companies will continue to promote limited downstream consumer rebates as well as an upstream incentive promotion with various Connecticut supply houses and retailers who stock and sell high efficiency equipment. The companies plan to move to a full scale upstream approach whereas all supply houses will participate through that channel. 162

169 Home Energy Solutions Income Eligible (Electric and Natural Gas) In 2014, the HES-IE program will include LEDs and basement and garage ceiling insulation in its list of product offerings. The LED offering will be based on the results of an RFP that will be released as part of the HES program in The LEDs will include interior dwelling unit lighting, common areas and some exterior lighting. Basement and garage ceiling insulation will use the program guidelines set forth within HES-IE program. In addition, the program will offer insulation up to a cost effective threshold in renter-occupied units (as opposed to requiring a 20% cost share) to further participation. HES-IE plans to migrate to the HES Mobile tool by the Third Quarter of The EDCs will work closely with Community Action Agencies to increase HES-IE market penetration, and to consider opportunities for integrating HES-IE program implementation with implementation of the federal DOE Weatherization Assistance Program. 163

170 Residential Behavior Program (Electric and Natural Gas) The objective of the Residential Behavior program is to propel behavioral residential conservation efforts to reduce energy consumption as well as increase participation in residential energy efficiency programs funded by Energize CT and offered by The Companies. The Residential Behavior programs has evolved since the past Home Energy Report Pilots and have incorporated the past lessons learned into an enhanced customer behavior offering. This program will focus less on a separate stand-alone behavior project and instead on the larger and more impactful goal of ensuring that customers get meaningful and appropriately targeted energy efficiency information, advice and support to achieve savings while driving greater customer satisfaction. The CL&P Behavior Program will expand upon the successful pilot initiated in January 2011 and resulted in 1.7% energy savings for participants. The enhanced behavior program will seek to maximize cost effectiveness while reaching a wider customer base. In addition, the expanded program will include a subset of HES and HES-IE participants with the objective of increasing savings for those customers. The program will include the following components: 17,000 customers from the initial pilot will continue to receive reports for two additional years. A total of seven reports will be delivered to these customers to maintain and increase the savings already achieved through the pilot. 200,000 high use customers will receive hardcopy reports in the mail for two years. A total of nine reports will be sent to these customers over the two year time frame. 100,000 high use customers will receive one paper report and electronic ( ) follow up reports for two years. Up to 30,000 customers who have participated in HES or HES-IE will be enrolled in the program on a rolling basis. These customers will receive reports with customized tips intended to maintain energy savings from installed measures as well as to increase the adoption of add-on measures. All customers (347,000 comprised of 317,000 new plus 30,000 from the bullet above) will be provided access to a web portal that will provide them with web access to their home energy reports, energy saving tips, and a description of their home characteristics that have a major impact on comparing their home energy use with other similar types of homes. This web portal will ultimately be integrated into CL&P s customer engagement platform. UI Wi-Fi Enabled Residential Thermostat Management Pilot UI is embarking on a two year Wi-Fi Enabled Residential Thermostat Management Pilot program that brings together state of the art technology and a customer platform that enhances the effectiveness and savings of this technology. This pilot will bring together state of the art Wi-Fi 164

171 enabled thermostats and a user proven and friendly customer platform. This two year Pilot is designed to deliver verifiable gas and electric energy savings while empowering customers with enhanced home control, comfort and convenience. UI will deliver an integrated solution that leverages its vendor s expertise in customer engagement and home control, while delivering an engaging customer experience and delivering measurable energy savings. The pilot will target 5,000 UI gas heat and central air conditioning customers over a two year period. The Pilot will be marketed and delivered to customers through two primary channels. The first is through the existing HES program and the HES Vendor network. Installations through this avenue are ideal and will enable UI to keep installation costs down. In conjunction with the HES program, UI will also offer the Wi-Fi Enabled Residential Thermostat through a standalone direct install program. The program is designed to deliver measurable energy efficiency with an estimated savings of up to 15-20% on electric heating and cooling, and up to 10-15% savings on gas heating. This is accomplished by the enrollment process, the delivery of customized messages and the use of behavioral science to drive efficient and rewarding decisions. To participate, customers must have a Wi-Fi router in their home. The enrollment process walks the customer through the initial set up and creates a tailored thermostat schedule through an intuitive web interface. The enrollment process integrates the device scheduling into the program set up, ensuring 100% of thermostats have customized schedules at installation. Once enrolled the customer will be able to install a special app in their I-Phone or Android based phone, giving the customer a robust mobile platform that provides anytime, anywhere access to their thermostat. Customers will have the easy ability to switch to Away mode, manage their HVAC system to save energy and to make their homes comfortable upon return all through this App. When a customer makes any set point change to their heating or cooling system, the software platform will deliver real time recommendations and savings estimates tailored for each customer based on their actual energy usage and billing profile. This type of user friendly software and unique approach to real time behavioral science will drive efficiency and reward customer decisions to maximize savings and comfort. Customers will also receive alerts when they have set an inefficient temperature and can then remedy the situations and earn positive reinforcement. 165

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173 CHAPTER FOUR: COMMERCIAL AND INDUSTRIAL PROGRAMS Overview The Companies have been delivering energy efficiency programs to C&I customers for over two decades that are among the best in the nation. Despite that proven track record, the Companies continue to innovate and improve on the program delivery. The Plan, as well as the CES, calls for programs that provide the industrial sector with deeper energy savings. They also call for the Companies to integrate the CEFIA financing programs into the CL&M program offerings in a seamless fashion. The C&I programs continue to mature and evolve with an expanded budget and expanded savings goals. The intent of the enhancements, discussed below, continue to support the muchdiscussed concept of deeper and broader energy reductions. The Companies will continue their efforts in customer segmentation, which helps to align programs and initiatives already in place with the specific customer segment need and, sometimes, the specific customer need. Segmentation is the first step in understanding how to go deeper with our larger customers in certain key segments. Segmentation also helps us to better know how to sell energy efficiency via our external sales force in quartile three independent trade allies or preferred trade allies, and to help us focus the sales and marketing efforts of our external sales force for quartile four via the SBEA contractors. Introducing the market channel concept of Upstream will allow the Companies to go broader in the C&I marketplace. For C&I upstream, the channel partner is usually the preferred distributor, where the distributor becomes an extension of our ability to market or sell energy efficiency as opposed to the traditional model of only marketing directly to a customer or their contractor. Deployment Strategy The Companies are underway on the following strategies and tactics intended to both increase program participation and to identify and achieve deeper savings. The Companies will continue to refine their customer segmentation efforts by further analyzing their C&I customer base into meaningful segments and delivery approaches, especially critical for the largest quantity of customers within quartile four, which will require a very different market channel and go-to-market strategy. As a result of the Companies segmentation efforts, current operating models will require modification. CL&P believes that dedicated energy efficiency sales personnel are needed to penetrate certain key segments such as manufacturing. Likewise, UI has decided to realign its C&I team s focus by targeting the largest customer segments while still continuing to address all market segments. The top ten segments representing the largest percentages of energy 167

174 consumption for both Companies are as follows: Manufacturing, Water/Wastewater, Government, Retail, Healthcare, Real Estate Management (Corporate Space), Education, Consumer Goods/ Foods, Data Centers, and Communication/Entertainment. Percentages vary depending on the EDC. The Companies will focus on facilitating Strategic Energy Management practices by utilizing multi-year MOU with their largest customers as a formal mechanism to lay out long-term goals for significant energy reduction. The multi-year plan is the basis of sound energy management practices which continuously evaluates the customer s energy efficiency opportunities. CL&P is also planning to enter into MOUs for certain quartile three manufacturing customers as a follow-up to kaizen events offered through the PRIME program. These MOUs will focus on BSC processes and practices. In addition, small-tomedium sized businesses will be increasingly targeted through packaged SEM and customer engagement tools. The Companies will continue the efforts of segmentation of the quartile four customers, which contains approximately 90% of the C&I customers. Continued evaluation and analysis of sub-segments SQ1 SQ4 will provide valuable insight into objectives like increasing the closure rate for the existing SBEA program, integrating or bundling of certain measure mixes to key customer types and insight to facilitate the use of the customer engagement platform to better serve SQ4 micro-businesses. Incentive Caps per Customer Tax ID will be raised to a cumulative total of $2,000,000 as directed by DEEP in its Decision. The Companies, in conjunction with the EEB s C&I Committee, are exploring the economic feasibility of offering an incentive for Solar Thermal systems. The Companies will continue to develop greater partnerships with CEFIA, and DEEP s Lead By Example initiative in providing programs that will intertwine and work in conjunction with each organization. These will include offering CPACE or performance contracting where it can be most beneficial to the customer. The Companies will also continue to work to improve the efficiency of State buildings. A commercial lighting upstream promotion will be launched in 2014 to promote low wattage T-8s and LED lamps, allowing the Companies to reach a broader base of customers. Additional products and strategies to promote efficient electric and gas HVAC equipment through manufacturers and distributors will be explored throughout the year. All upstream initiatives will be timed so as to minimize any negative impact on traditional downstream (customer) incentives with respect to the budgets. 168

175 Industrial customers will be a continued focus in the coming years. The Companies will develop an offering to allow manufacturers the flexibility to embed efficiency into the core of their operations. The Companies will also work on DOE s Superior Energy Performance Accelerator as well as a revamped BSC with an eye towards developing best practices for C&I energy savings. The bulleted items shown above increase the overall cost effectiveness of programs. In particular, segmentation, SEM and DEEP s LBE Initiative will improve gas cost effectiveness. However, the total resource cost test, includes customer costs. It is anticipated that the total resource benefit-cost ratio will improve for certain projects. Generally, C&I gas measures are cost effective based on energy savings. However, the higher equipment costs and thus the customer costs for some measures may result in a lower total resource benefit-cost ratio. 169

176 C&I NEW CONSTRUCTION Energy Conscious Blueprint Overview The objective of the Energy Conscious Blueprint ( ECB ) program is to facilitate a more energy efficient building stock in Connecticut and maximize electric and natural gas energy savings for lost opportunity projects, at the time of initial construction/major renovation, or when equipment needs to be replaced or added. ECB is structured to minimize lost opportunities involving new construction, major renovation, tenant fit-outs, and equipment replacement and additions by introducing energy efficiency concepts to customers, architects, engineering firms, contractors, commissioning agents, commercial realtors, trade allies, etc., demonstrating the benefits of selecting efficient options early in the design stage and, working with the design community to convince customers that more benefits are achievable by designing for whole-building operations and operating conditions. Deployment Strategy The Companies may implement the following strategies and tactics intended to both increase program participation and to identify and achieve broader and deeper savings relative to the new construction marketplace as well as equipment replacement. The Companies are developing an Upstream HVAC and Commercial Domestic Water Heating ( DHW ) Equipment initiative similar to the Upstream Lighting Initiative, which is described in the Energy Opportunities ( EO ) section. The goal is to capture sales of high efficiency gas heating, service water and rooftop cooling equipment to a broader base of customers, by using a more appropriate market channel (the distributors as opposed to individual contractors.) Savings and budget numbers are intended to be accounted for as lost opportunities in the electric and gas programs. As the initiative matures, it will be seen as a replacement of the equipment rebates. 170

177 C&I RETROFIT Energy Opportunities Overview The EO program encourages customers and their contractors or Energy Service Companies ( ESCOs ) to save energy in existing commercial, industrial, and municipal facilities by offering incentives, financing and other resources to replace existing, inefficient equipment with energysaving options. Program Description The EO program provides technical assistance (to identify and quantify opportunities), financial incentives based on project costs, quality assurance ( QA ) of energy savings calculations and analysis, verification of installed equipment efficiency, and financing options. In most EO projects, a customer voluntarily exchanges or modifies inefficient but functioning equipment with a high-efficiency alternative that meets or exceeds efficiency standards where applicable and provides the same level of functionality. The combination of financial incentives, technical assistance, and financing can help make energy efficiency projects meet the Customers payback and/or cash flow requirements. In addition to the financial offerings, the program relies on a robust collaboration with contractors, equipment vendors, suppliers, and ESCOs. The EO program will continue to focus on long-term, multi-year, strategic planning with customers in an effort to best understand their businesses and help to generate comprehensive energy efficiency projects to improve overall building performance to encourage multiple energy efficiency measures with multiple end-uses whenever it is practical. Deployment Strategy In 2014, the following enhancements are being developed to allow the Companies to facilitate more comprehensive projects geared toward generating deeper opportunities for optimizing the various energy consuming systems within a facility. Enhanced Customer Segmentation As discussed in the Overview section, the Companies are focusing on customer segmentation by dividing the customer base into meaningful segments according to a variety of characteristics including but not limited to, industry classification, usage, and demand. Enhancing Services to Specific Market Segments - Based on the segmentation analyses, the Companies are considering targeted incentives and go-to-market strategies for particular customer segments. Two examples of this are: 1) offering unique incentives for emerging technologies and/or for specific manufacturing scenarios which have the potential for 171

178 significant savings, but are limited by the current incentive designs; and, 2) utilization of a customer-specific MOU to help drive strategic energy management practices with different levels of technical and financial support that is customized to the needs of that specific customer. The Companies will continue using a diverse portfolio of electric and gas rebates for energy efficient heating, water heating, commercial kitchen food service including refrigeration, and laundry equipment. In addition, prescriptive incentives along with the concept of bundled packages of equipment incentives for select customer segments will continue to be investigated and developed as additional go-to-market strategies for reaching the broader market of customers and trade allies. The Companies will implement an Upstream Lighting Initiative. This initiative utilizes a Third Party Program Manager and distributor incentives to facilitate capturing sales of energy efficient lamps (specifically, linear fluorescents and LED types) to a broader base of customers. Savings and budget numbers are intended to be accounted for in both the EO and Operations and Maintenance ( O&M ) programs. As the initiative matures, the offering will be seen as a replacement of the Express Lighting rebates. 172

179 Small Business Energy Advantage Overview The objective of the SBEA program is to provide cost-effective, turnkey C&LM services to a broad base of small commercial or industrial business customers. Program Description The Companies, through a network of approved contractors, provide direct install or turnkey services to maximize energy-efficiency operations for customers. These direct services include energy assessments and installation of measures. The Companies pay incentives for relevant energy efficiency measures within cost-effectiveness constraints, and offer an interest-free financing option to credit-qualifying customers for the balance resulting in a cash positive scenario (where applicable.) The financed contract amount appears as a line item on the customer s electric bill (this includes costs for the portfolio of gas measures as well.) The loan repayment term, which is determined by the simple payback of the project, is set at a level which typically provides the customer with a positive annual cash flow based upon the estimated energy savings resulting from the installed measures. Deployment Strategy The Companies realize that in order to achieve the expanded goals, the SBEA Program will need to quickly act on several enhancements to the program, including: Focused Market Segmentation The Companies are finalizing their targeted market segmentation achieving greater (broader) penetration in under-served sectors, not limited to small manufacturers and distressed urban areas. Additional efforts on segmentation will assist in identifying specific areas of focus for the SBEA contractors and may also result in measure bundling to help expedite the process of implementing comprehensive projects. The Companies have finalized a joint, competitive bid solicitation that will establish the SBEA vendor network for calendar years 2014 and It is anticipated that there will be approximately 22 vendors (up from 16 in 2013) serving both service territories and delivering SBEA program services for the 2014 and 2015 program years. Master Agreement ( MA ) with the State The Companies have been working with DEEP on the MA which allows the SBEA vendors to install energy efficient measures and offer 0% on bill financing up to four years. CL&P is currently in the implementation phase. The development of the Upstream Lighting Initiative for 2014 will help the SBEA program by providing price points for specific lighting technologies which in turn can be implemented in the SBEA pricing structure to reduce cost. 173

180 The Companies will develop a Certified Energy Auditor training program for the SBEA vendors which is similar to the BPI certifications that are available to the HES vendors. The dual strategy of this initiative is to instill a deeper, more comprehensive skill level in the existing auditing workforce and at the same time increase the number of auditors with a more diverse representation to better replicate the multilingual/multicultural small business customer. The Companies plan to work with their current third party C&I financing vendors or others, (i.e., CEFIA, etc.) to provide loan capital for the SBEA/Muni program in an effort to reduce the programs interest expense costs and continue to improve the overall program s cost effectiveness. Expanded outreach to hard-to-reach communities/market segments through local business/community organizations (i.e., Operation Fuel, Spanish American Merchants Association ( SAMA )) and the Office of Energy Efficiency Business. 174

181 BUSINESS & ENERGY SUSTAINABILITY Retro-Commissioning ( RCx ) Overview The objective of the RCx program is to help building owners improve the efficiency of their building operations by offering incentives, quality control, and technical assistance by providing qualified building commissioning engineers to conduct the evaluation process and by supplying funding and oversight to support the RCx process. The program is intended to help businesses identify low-cost/no cost non-capital, energyefficient measures that will quickly and effectively result in energy savings for the owner of the building. This platform makes building owners & operators aware of operating inefficiencies in their facilities, improves the building staff s ability to identify wasteful energy use and implements persistent corrective measures systematically to generate energy savings. Deployment Strategy In 2012, the Companies found that RCx produced significant benefits and that the future would require a greater emphasis on RCx projects. The Companies jointly released a Request for Qualifications ( RFQ ) with the objective of qualifying additional engineering talent to service this program. Throughout the fourth quarter of 2012 and into 2013, a new group of qualified engineers were approved and are ready to provide services for 2014 and In addition, the Companies are looking to enhance the program by developing a greater customer focus and a larger pool of Commissioning Agents ( CxP s ) to allow the Companies to investigate and potentially develop an RCx or similar engineering study/audit and implementation program offering that is suitable for customers with smaller facility footprints (less than 100,000 sf). 175

182 Process Re-engineering for Increased Manufacturing Efficiency ( PRIME ) Overview The objective of the PRIME program is to teach manufacturers lean manufacturing techniques that will increase their productivity, improve workplace organization, reduce waste, reduce operating inefficiencies, and encourage a safer and cleaner workplace, thereby improving the ratio of energy used per product produced. Lean manufacturers are able to produce more with existing resources by eliminating non-value-added activities and waste, and by aligning production to meet actual customer demand. In addition, lean manufacturing results in the more efficient use of energy per product produced by reducing non-manufacturing related electricity consumption and by reducing losses in manufacturing equipment consumption. Program Description PRIME offers customers the opportunity to participate in up to four separate three-and-a-half day, team-based Kaizen events at their facility which teach the fundamentals of lean manufacturing and facilitates the implementation of quick changes to a process in order to eliminate waste and improve efficiency. Deployment Strategy In 2014, the Companies are considering releasing an RFP in order to enlist the proper talent to serve an increased quantity of customer projects as well as to help introduce and implement the BSC to this key group of customers. Other changes being considered for inclusion into this RFP include holding vendors responsible for specific goals (i.e. annual kwh, costs saving, or other metrics), as well as incorporating the other items listed below. In 2014, efforts will be made to train the PRIME vendors to identify other energy savings opportunities like those found in an energy intensive technology like plastic mold machines, conveyor systems, heat-treating, process-cooling and compressed air systems. The Companies are exploring the feasibility of increasing the subsidies for the third and fourth events if the customer completes an energy conservation project of an agreed upon predetermined energy savings value. The Companies are investigating ways to expand the PRIME or Lean process to commercial non-manufacturing opportunities in

183 O&M Services Overview Provide customer solutions to a number of varying energy savings issues that do not typically require capital appropriations, as they are identified and presented for incentive funding. Program Description O&M services offers electric and natural gas incentives and analytical services for C&I customers to tune-up their operations and improve O&M of their facilities in order to make them more energy efficient. The Companies provide O&M evaluations and recommendations upon request, with the C&I customer being responsible for implementing the O&M improvements. Examples of such improvements are intended to maximize operational efficiency and optimize performance include things like compressed-air system leak studies and repairs, steam trap repairs and upgrades, modifications and/or repairs to building management system control components and software programming. Deployment Strategy The development of the Upstream Lighting initiative will provide distributor incentives to facilitate capturing sales of energy efficient lamps (specific linear fluorescents) to a broader base of customer. Savings and budget numbers are intended to be accounted for in both the EO and O&M programs. The inclusion of linear fluorescents closely aligns with the proven practice of group re-lamping (an O&M activity). Comprehensive Energy Strategy Support In support of the CES, Strategic Energy Management Efforts for Industries will be employed. The Companies are investigating the use of unique technical and monetary assistance to improve comprehensiveness for the state s industrial customers. Manufacturing companies have unique and difficult challenges and may require a unique approach involving a different incentive tactic and go-to-market strategy. This involves partnering with trade allies and certain industry experts who focus on building end-uses such as data centers, plastic extrusion, food and beverage and the aerospace-related technologies. 177

184 This is especially critical for CL&P s C&I customer base where almost a third of the annual energy consumed in the top three quartiles is from manufacturers as shown in the chart below. 7% 8% 6% Q1-Q3 Usage % - CL&P 1% 1% 1% 0% 5% 4% 29% 16% 10% 10% Manufacturing Retail Government Agency RE Management Educational Healthcare Communication & Entertainment Financial Professional Service Lodging Water / Waste Water Wholesale Utility Another example of CL&P s focus on the industrial sector is the MOU with the U.S. Department of Energy ( U.S. DOE ) for their Industrial Strategic Energy Management Accelerator ( Accelerator ) that CL&P, through its parent Northeast Utilities, signed during the fourth quarter of Through the Accelerator, utilities and energy efficiency program administrators partner with the U.S. DOE to demonstrate robust energy management as a practical program offering to improve energy efficiency in industrial companies and facilities. Accelerator Utility Partners agree to actively promote Superior Energy Performance ( SEP ) to manufacturers in their service territories and to assist them in its implementation. 178

185 Business Sustainability Challenge ( BSC ) Overview The objective of the BSC is to foster organizations transformation toward greater efficiency and sustainability. The program employs a holistic approach consisting of training, education, tools and resources to assist businesses in developing SEM and sustainability plans, create behavioral and cultural changes, reduce waste, improve operational efficiencies and increase market acceptance of the triple bottom line with business sustainability. Program Description The BSC is an umbrella approach to supporting companies in Connecticut becoming progressively more sustainable and competitive. It places energy efficiency within the broader context of sustainability and competitiveness The BSC leverages energy efficiency ratepayer funding to synergistically achieve energy and non-energy benefits. The BSC was redesigned in 2013 to guide companies through five strategically interwoven steps that make sustainability accessible, achievable, measurable and profitable for companies of all sizes and sectors. It now provides the structure and resources to help participants chart their own path towards sustainability and work together to achieve specific goals. Participants proceed through the steps (identified below) at their own pace to implement, measure, and communicate progress as part of the larger goal of becoming a resilient and competitive company. Step One focuses on strategic energy management and improving a company s bottom line through emphasizing both energy efficiency and waste reduction. Step Two begins to integrate sustainability throughout a company, focusing on expanding management s capacity to use sustainability as an aspect of its decision making, especially in risk mitigation. It extends sustainability performance indicators to include water and material use. Step Three emphasizes growing sales through transparency around sustainability efforts and through engagement with customers. These changes create new sales opportunities and integrate sustainability as an aspect of both operational and quality management. Step Four helps a company build a culture of innovation around sustainability. Evaluating and redesigning the value proposition from a sustainability perspective improves employee commitment and customer loyalty. Step Five presents a long-term vision for industry leadership based on net-zero impact operations and inter-company alliances. It creates a resilient learning organization with 179

186 people and processes that thrive in an unpredictable future. Deployment Strategy In 2013, the Companies recognized that the existing model for BSC needed to be restructured for it to be an effective offering for Connecticut businesses. The Companies worked with a consultant to restructure the BSC into its present format. The Companies then introduced the changes to the EEB board to obtain both approval and support for the new program structure. These changes have created a fully vetted program for action replacing the pilot from the previous years. The BSC serves as a customer focused umbrella for the other C&LM programs and encourages participants to maximize their energy savings. It frames sustainability from a business strategy perspective to achieve continuous improvement. The BSC integrates business sustainability with other opportunities for lean manufacturing (via the PRIME program), energy efficiency, renewable energy generation, and clean energy purchasing. Potential synergies include coordination with the Clean Energy Communities ( CEC ) Program, partnering with CEFIA to leverage creative financing options for customers for both energy efficient and renewable energy technologies, and developing strategies to move customers toward Net Zero Building designs. The BSC is currently exploring the development of peer networks such as, but not limited to, universities, small business manufacturing roundtables, and larger Cross-Community Engagement and Collaboration Forums sponsored by industry leaders. The program anticipates further integrating the BSC with other incentives and grants in the communities where the business operates. The program is developing metrics to measure both the success of individual customers as well as the success of the BSC program as a whole. 180

187 Self-Directed Customer Solutions Overview Self-directed solutions offer electric and natural gas incentives and analytical services for the largest C&I customers, primarily the largest manufacturers, to improve their facilities allowing them to become more energy efficient. This is now possible since DEEP ordered the Companies to increase the annual project incentive cap from $1 million to $2 million as well as eliminate it entirely for certain customer projects with prior Department approval. Deployment Strategy The Companies can provide evaluations and recommendations upon request, when the customer agrees to implement the improvements via the more typical Letter of Agreement or under an MOU. Either agreement mechanism will be used as part of a roadmap toward significant energy efficiency projects, tailored to the customer s needs and capital program. This solution encourages that, as the new energy-saving equipment and strategies are installed, facility staff will be provided with appropriate training to maintain equipment at maximum operational efficiency. The Companies are executing this large customer-specific efficiency project initiative through the collaborative effort between DEEP, the EEB, and the Companies. All incentives offered through the program will be subject to benefit-to-cost screening to insure continued cost effectiveness of the program offerings and subject to the current incentive structure. CL&P will look to use the additional tools and resources available through the signed MOU with the U.S. DOE for the SEP Accelerator for the very large manufacturing customers, discussed in the Overview section above. Continue ongoing collaborations with business/industry associations to ensure more effective program customization for larger customers (Connecticut Industrial Energy Consumers, Connecticut Business and Industry Association, Manufacturing Alliance of Connecticut etc.). 181

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189 CHAPTER FIVE: EDUCATION and OUTREACH Overview The Companies are committed to educating and informing Connecticut s businesses, municipalities, residents and schoolchildren on the importance of using energy efficiently. The Companies meet and surpass this educational mandate through a variety of programs including school-based programs (kindergarten through college), public forums, technical training and seminars, educational exhibits and centers, trade shows and community and grassroots outreach. Connecticut s energy education programs and initiatives are necessary to provide individuals with the knowledge, skills and power needed to use energy efficiently. The educational programs are diverse in audience and delivery but share one common goal and that is to educate, empower and energize the state s businesses, municipalities, residents and schoolchildren to use energy wisely Program Changes eesmarts eesmarts is an energy efficiency and clean, renewable energy learning initiative. Created in 2002, the program s goal is to facilitate students understanding of math, science and technology related to energy conservation, renewable energy resources and electricity in order to create an energy-efficient ethic among Connecticut s students. eesmarts offers teacher training workshops, curriculum materials, essay contest, sponsors sustainable resources category at the CT Science Fair, lights for learning fundraiser, on-site program, outreach and educational resources. New in 2014, under the eesmarts umbrella are the following programs in support of our educational objectives: eesmarts Energy-Saving Challenge Pilot The goal of the eesmarts Energy-Saving Challenge ( Challenge ) is to implement eesmarts curriculum directly in the classroom to prepare students and educators to participate in the Challenge during the school year. Students and their families will be challenged to save energy through various behavior changes. Students will be engaged directly through in-school presentations, monthly newsletters, as well as follow-up throughout the competition and an end-of-challenge Celebration. The eesmarts program is exploring additional programs and opportunities to capture energy savings from students and teachers including, but not limited to: surveys, opt-in energy tracking programs and weatherization kits. 183

190 CT Clean Trades ( CCTP ) The goal of CCTP is to implement innovative work-based curriculum from the eesmarts program to prepare Connecticut Technical High School System ( CTHSS ) students for jobs in the energy efficiency sector. The need to reduce our carbon footprint necessitates a widespread effort to conserve energy while creating new, cleaner alternative energy sources to sustain our world. To meet this challenge, workers in the electrical, carpentry, plumbing, and HVAC trades will need additional knowledge and skills needed for employment in the new green jobs marketplace. CCTP offers students the opportunity to research, analyze, and implement energy efficiency strategies in their schools and communities. At the same time, they will gain knowledge of related career pathways by participating in unique real-world learning experiences. During the school year, approximately 50 CTHSS trade instructors will implement Project Learning Tree s GreenSchools! Investigations at five technical high schools across the state. Over 400 students will participate in performing energy, waste and recycling, water and indoor air quality investigations (or audits ) of their technical high schools. At the conclusion of their investigations, students will create an action plan to implement their recommendations and improve the sustainability of their school. The five technical high schools include: Platt Technical High School (Milford), E.C. Goodwin (New Britain), Norwich Tech (Norwich), Henry Abbott Technical High School (Danbury), and Ella T. Grasso Technical High School (Groton). Each of these technical high schools has constructed, or is working to construct, their schools E-House. Partners: o Connecticut Technical High Schools o Connecticut Department of Energy and Environmental Protection (DEEP) o Connecticut Energy Efficiency Fund (eesmarts & Clean Energy Communities) o The Connecticut Light & Power Company o The United Illuminating Company o Connecticut Business & Industry Association o American Forest Foundation- Project Learning Tree o Siemens CT Green LEAF Schools Program The Companies will continue to support the CT Green LEAF Schools program through the CEC Program, eesmarts and the C&I programs and its partnership with ISE. As the program is a collaborative effort of four Connecticut state agencies (DEEP, the Department of Construction Services, the Department of Education, and the Department of Public Health), along with several other statewide partner organizations, the Companies will support the energy efficiency component of the CT Green LEAF Schools program. The Companies will 184

191 provide assistance for the CT Green LEAF Schools program utilizing the educational, community-based and commercial/industrial program resources in the following manner: o o o o CT Green LEAF School Requirement: The school must complete the U.S. EPA s Portfolio Manager benchmarking. Through the CEC Program all public schools in the state will be benchmarked if they have signed the CEC Pledge to reduce their energy consumption by 20%. If the school is private, parochial, charter or a regional school, the CEC Program administrators will handle coordinating technical assistance on a case-by-case basis. CT Green LEAF School Requirement: Provide environmental and sustainable education. Through the eesmarts energy education program, all educators from schools participating in the CT Green LEAF Schools program are eligible to participate in program offerings. All Connecticut educators are eligible to participate in eesmarts professional development and gain access to the corresponding eesmarts lessons and materials. Participants in the CT Green LEAF Schools program will also be eligible to host an eesmarts Event at their school or in their classroom. Program participants will also be eligible to visit the SmartLiving Center for a free educational tour and bus reimbursements. CT Green LEAF School Requirement: Reduce energy building use and greenhouse gas emissions. Through the C&I programs, all CT Green LEAF Schools have access to incentives and financing available for retrofits and upgrades that may be identified through commercial audits and/or investigations. Additional support for CT Green LEAF Schools: Scholastic Bright Idea Grants. Through the CEC Program, there will be Scholastic Bright Idea Grants available to CT Green LEAF Schools. Connecticut schools that have signed up to be a CT Green LEAF School are eligible to apply for funding to make further energy-saving improvements and/or enhance energy programming within the school. Scholastic Bright Idea Grant criteria, applications for funding and technical assistance will be managed through the CEC Program by the Companies. SmartLiving Center The SmartLiving Center relocation project is currently in progress. The Companies are in formal negotiations to secure a larger, more centrally located facility in North Haven and plan to open the new center in the fall of The Companies are investigating the options available for customers to opt-in for energy tracking programs. Additionally, The Companies are investigating other ways to capture behavioral changes and the associated energy savings including, but not limited to: surveys, 185

192 weatherization kits and lighting and/or programmable thermostat giveaways. The SmartLiving Center will also explore opportunities for tracking program participation as a result of a customer s visit to the Center. 186

193 CHAPTER SIX: BENEFIT/COST ANALYSIS The Decision approved the programs, adjusted the budgets levels and requested certain changes to individual programs. The Decision also found the programs to be cost effective. The Decision further instructed the companies to include all cost and benefits in the cost effectiveness tests in all future submittals (Compliance Order 6). 1 While previously approved and deemed cost effective, the programs have been rescreened for the Plan Update to include or account for the following factors, as well as the programmatic changes described in the program changes summaries. Budget Levels, Incentive Levels and Program Savings The Decision modified the budget levels. As a result, the incentive amounts for the programs were adjusted, affecting the program participation rate and the resultant program savings. Table A and Table C provide details on the changes to budgets. Table B s reflect the all of the above changes and their impacts on the programs costs rates, savings and benefit cost ratios. Updated avoided costs based upon the Avoided Cost Study Per the Compliance Schedule in the DEEP Final Decision (Order 6), all costs and benefits are included in the benefit cost testing for 2014 and The majority of the avoided costs used to analyze the cost effectiveness of the efficiency programs come from a regional avoided energy cost study sponsored by program administrators throughout the New England region. The study, Avoided Energy Supply Costs in New England: 2013 Report (AESC), Synapse Energy Economics, Inc. (Synapse) was published July The avoided costs in the screening of the programs were updated to reflect the changes in the avoided costs. This report provides a variety of avoided costs for both electric and gas. The gas avoided costs have been further developed in the 2013 avoided cost study. A summary of the benefits and costs used in 2014 and 2015 benefit-cost screening are shown in the following table. Costs and Benefits Per Order 6 in the Decision (pp30-31), all costs and benefits are to be included in the benefit cost testing for 2014 and 2015, which results in a change to the utility benefit cost test. The 1 DEEP requires that all costs and benefits be included in the cost-effectiveness tests in all future submittals. 187

194 oil and propane measures installed in in electric and gas programs are now counted as benefits under the Utility Cost and Total Resource Cost Test. The Companies look forward to the discussion of this topic in the cost effectiveness review proceeding identified by DEEP in the Decision (pp 27). To help facilitate this discussion, CL&P and YGS have included a modified Table B-2 which itemizes each of the benefits and costs on a program level for both the modified Utility Cost Test and the Total Resource Cost Test. Utility Test (Electric, Gas) Benefits and Costs Table Benefit (Note 1) Utility Benefit Total Resource Benefit Benefits Electric Electric Energy X X Electric Transmission X X Electric Distribution X X Electric Capacity X X Electric Instrastate DRIPE X X Electric Rest of Pool DRIPE X (Note 2) X (Note 2) Electric Capacity DRIPE X X Electric Cross-Fuel DRIPE X X Electric Emissons X Electric/Gas Oil X (Note 3) X (Note 3) Electric/Gas Propane X (Note 3) X (Note 3) Electric/Gas Water X Electric/Gas Non-Resource X Gas Gas X X Gas Gas DRIPE X X Gas Gas Cross-fuel X X Utility Cost Utility Cost Total Resource Cost (Note 4) Costs Electric/Gas Program Cost X X Electric/Gas Customer Cost X Note 1: Rest of Pool DRIPE, Cross-Fuel Dripe, Gas DRIPE and Gas Cross-Fuel DRIPE were not reported in Cross-Fuel DRIPE, Gas DRIPE and Gas Cross-Fuel DRIPE are new avoided costs that are included in the 2013 Avoided Cost Study but not included in the 2011 Study or included in 2013 Program Screening. Note 2: UI table B for 2014 and 2015 do not include Rest of Pool DRIPE. CL&P table B-2 presents all benefits shown above including Rest of Pool DRIPE. Note 3: Oil and Propane Benefits reported in gas programs are a result of gas programs assuming oil and propane costs for HES participants per the DEEP Final Decision on the Plan. Note 4: The Total Resource Cost Test includes all costs associated with a measure i.e. both program costs and any customer out-of-pocket costs not covered through the program. 188

195 Changes to the Program Savings Documentation ( PSD ) The PSD manual provides detailed, comprehensive documentation of resource and nonresource savings corresponding to the Energy Efficiency Fund program and individual C&LM program technologies. The Companies have worked together during the past decade to develop common engineering assumptions regarding measured savings for all types of energy-efficient measures. This manual is a compilation of those efforts. In addition, the results of program impact evaluations have been incorporated by the Program Administrators. The manual is reviewed annually and updated to reflect changes in technology, baselines, measured savings, evaluation work, and impact factors. The Ninth Annual Edition for the 2014 Program Year will be filed separately on March 1, The changes in this edition have been included in the updated screening for the 2014 Plan Update. Addition of a modified Utility Cost Test ( UCT ) Since the programs have already been found cost effective, the Companies used this opportunity to develop and use a modified utility cost test, labeled Program B/C Ratio in Table B. The primary difference between the modified UCT used in 2014 and 2015 versus the 2013 UCT is the 2014/15 modified UCT includes the benefits arising from oil and propane savings. The Companies look forward to participating in the DEEP cost effectiveness review proceeding identified by DEEP in the Decision (pp 27). The modified utility cost test is the utility cost test with the addition of the costs and savings benefits of oil and propane installed measures. This primarily affects the residential sector and is not included in the C&I section. The benefits of oil and propane have always been included as a non-electric resource and included in the Total Resource Cost test. Discount Rate The Plan used a discount rate of 7.52% for the EDC screening and 7% for the LDC screening, based upon the Companies weighted after tax average cost of capital, and no less than minimum rate of 7% stated in Docket , DPUC Review of The Connecticut Gas Utilities Forecasts of Demand and Supply and Joint Conservation Plans and , DPUC Review of The Connecticut Energy Efficiency Fund's 2010 Conservation and Load Management Plan for In this 2014 Annual Screening, UI has chosen to utilize the same long-term nominal discount rate as the regional avoided cost study of 3.39%. CL&P and YGS continue to use a 7.52% nominal discount rate for EDC screening and 7% nominal discount rate LDC screening as directed by the DPUC. The differences in discount rates have a significant impact on the value of the benefits and the benefit/cost ratios. The use of a 7.52% percent discount rate compared to a 3.39% 189

196 discount rate for the electric programs results in approximately a 22 percent lower value of the claimed benefits and on the benefit-cost ratios. On the gas side, the comparable reduction is 27 percent. Cost Splits Per the Decision, cost splits for residential programs have been re-calculated based on the new avoided cost study. The following tables summarize the cost splits that will be used in 2014 and 2015 for residential programs. For C&I programs and custom projects, cost splits are calculated based on the relative benefit of each fuel using the modified utility cost criteria which includes all the benefits shown above. Costs for "single-fuel" measures are assigned to the appropriate budget based on the fuel type. For example, lighting is an "electric only" (the benefit is limited to electric savings). Therefore, 100% of the cost for lighting measures is allocated to the electric program. Costs for multi-fuel measures (e.g. Measures that save electricity and fossil fuel) are allocated to the respective budget based on the average dollar benefit realized for each fuel for those measures using the modified utility cost test benefits. Cost components for fossil fuel measures do not include any electrical components. 190

197 HES Residential Cost Splits all electric gas heat w/cac gas heat no CAC oil+pro w/cac oil+pro no CAC ELE/GAS ELE/GAS ELE/OIL ELE/OIL Administration 100% 50/50 30/70 30/70 15/85 Blower Door 100% 15/85 0/100 10/90 0/100 Air Flow / Heat Rise test 100% 60/40 25/75 35/65 10/90 Duct Blaster 100% 60/40 25/75 35/65 10/90 Installation of lighting 100% to Electric DHW & Pipe Insulation Clothes Washer Appliances 100% to the DHW source 100% to Electric Windows 100% 25/75 0/100 5/95 0/100 Insulation 100% 10/90 0/100 5/95 0/100 HES-IE all electric gas heat w/cac gas heat no CAC oil+pro w/cac oil+pro no CAC ELE/GAS ELE/GAS ELE/OIL ELE/OIL Administration 100% 35/65 25/75 10/90 10/90 Blower Door 100% 15/85 0/100 10/90 0/100 Air Flow / Heat Rise test 100% 60/40 25/75 35/65 10/90 Duct Blaster 100% 60/40 25/75 35/65 10/90 Installation of lighting 100% to Electric DHW & Pipe Insulation Clothes Washer Appliances 100% to the DHW source 100% to Electric Windows 100% 25/75 0/100 5/95 0/100 Insulation 100% 10/90 0/100 5/95 0/100 RNC all electric gas heat w/cac gas heat no CAC oil+pro w/cac oil+pro no CAC ELE/GAS ELE/GAS ELE/OIL ELE/OIL RNC - Single Family 100% 30/70 30/70 25/75 25/75 RNC - Multi Family 100% 45/55 45/55 25/75 25/75 HVAC all electric STATEWIDE, gas heat w/cac gas heat no CAC oil+pro w/cac oil+pro no CAC ELE/GAS ELE/GAS ELE/OIL ELE/OIL Furnaces 100% 35/65 35/65 $200 for ECM only 191

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199 APPENDICIES 193

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201 Appendix I - Compliance Items Order # Description Page # Reference 1 The Department requires the Companies to revise and resubmit 2014 and 2015 budgets for educational and administrative program costs no later than the 2014 Annual Update with proportionately adjusted budgets, or defaulting to an 80/20 basis between the EDC and the LDC budgets. Chapter 2 Table A1 EDCs Combined Table A1 LDCs 2 The Companies must ensure proper allocation of the cost for gas heating measures, minus any electrical components such as fans, to gas customers. 3 The Companies must propose an update to the Plan a mechanism that properly allocates the costs of HES core services between natural gas and electric budgets for any HES participant who becomes a gas customer (or newly converts their home heating equipment to natural gas). 4 The Department will require that natural gas program funding be used to support HES measures that save fuel oil or propane. This funding support will apply to all fuel oil and propane measure costs beyond those received from RGGI for fuel oil measures and the cost share will be split 50/50 between EDC and LDC budgets. 5 DEEP requires the Companies to detail any proposals to spend forward in the Annual Updates submitted to DEEP in the interim years of any threeyear C&LM plan period. The EEB may monitor and approve any forward spending of 15% or less of the subsequent year s budget. Any forward spending above the 15% threshold amount may not proceed without prior authorization by DEEP, which authorization could be requested at any time by the EDCs and LDCs. Response: At the time of this plan filing, the companies do not anticipate spending forward into DEEP requires that all costs and benefits be included in the costeffectiveness tests in all future submittals. 7 The Companies should explain in their 2014 Annual Update the extent to which gas C&I program improvements could improve the Total Resource benefit-cost ratio. 8 DEEP directs the Companies to track relevant data on a census tract basis or report to DEEP what steps they are taking to comply with the requirement to track data on this basis. After the Filing change the annual date to March 1st. Combined Chapter 6 PP Chapter 3 PP Chapter 3 PP 157 See Response in this section Chapter 2 All Table Bs and CL&P/YGS Table B2, text in Chapter 6 PP Chapter 4 PP 169 Not applicable to this filing. Due 6/1/

202 9 On or before June 1, 2014, and thereafter annually on March 1, each EDC shall submit to DEEP and the EEB a table containing data for the prior calendar year that includes, on a census tract basis or, if not available by census tract, on a town-by-town basis, the amount of conservation program funds assessed and the amount of incentives expended, disaggregated as small or large customers according to the 100 kw peak demand threshold, and further disaggregated by customer class (i.e., Residential and C&I).Additionally, on or before June 1, 2014, and thereafter annually on March 1, each EDC shall submit to DEEP and the EEB a table further disaggregating the residential data component for small customers as follows: specifically, the residential data component for small customers shall be disaggregated by the HES and HES-IE programs, and identify the total number of projects participating in each program, and disaggregate those project numbers by housing stock (i.e., single family, multi-family (2-4 units), and multi-family (>4 units)). The EDCs shall work together to produce a table format that presents the data from each of the companies in a consistent manner. After the Filing change the annual date to March 1st. 10 The EDCs shall submit revised performance incentive tables and a narrative to reflect the revisions described in the Decision. This submittal should include a proposal for identifying performance targets and the consequences for failing to meet those targets. 11 DEEP finds that the performance incentives proposed in the Plan should be adjusted for the EDCs and LDCs to increase savings and to ensure that estimated energy savings translate to deeper measures, including insulation and equipment installation. DEEP directs the EDCs and LDCs to work with the EEB to establish readily measurable specific goals for insulation, high efficiency equipment, and appliances for 2014 and DEEP requires that performance incentives be calculated based upon the actual expenditures and the savings achieved, which are to be scaled proportionally from the projected budget and savings goals to the actual budget at year s end. The Department s intent is for both EDC and LDC performance incentives mechanisms to operate identically. These calculations shall be done when year- end actual data is available and submitted in an Annual Update to the Department no later than March 1 of interim years. Response: The Companies (EDCs and LDCs) will also comply with the Decision in Docket No which directed the EDCs to prorate incentives when they over/under spend their budget by 5% or more. Not applicable to this filing. Due 6/1/2014 Chapter 2 CL&P/UI Performance Incentive exhibit Chapter 2 All Companies Performance Incentive exhibit Filed Separately 196

203 13 DEEP finds that the gas performance incentives proposed in the Plan must be adjusted to be more aggressive, to focus on installation of deeper measures, such as insulation, equipment, and gas appliances. DEEP directs the Companies to work with the EEB to establish for 2014 and 2015 specific, readily measurable performance goals for measures installation, such as insulation and high efficiency equipment. The LDCs ability to earn a performance incentive for HES will be based, among other things, on meeting the targets in Table 16. DEEP directs the Companies to work with the EEB to establish for 2014 and 2015 specific, readily measurable performance goals, including the goals in the above table. 14 For 2014 and 2015, the performance incentive for the lighting component of the Retail Products Program must be revised to move from the broad estimate of energy savings to more targeted metrics, such as overall saturation of efficient lighting, market share, general awareness, etc. The Companies and EEB will be required to determine alternative incentive strategies to advance efficient lighting. If this issue is not addressed the EDCs will not earn a performance incentive for this program in those years. 15 The EDCs shall better target the market segment that has not yet replaced incandescent bulbs throughout their home. The Department directs the EDCs to update the Plan to focus on the LED market, which would also be more reflective of the actual progress the EDCs are making in advancing LED market share. The Department agrees and directs the EDCs to revise their strategy going forward and include it in their 2014Annual Update in the Retail Products Program section. In addition, the LDCs must include a discussion of efforts to emphasize to industry and retail stakeholders the importance of cooperating to ensure the most efficient lighting products are readily available. The Department notes that effective August 2013, the EDCs discontinued providing incentives for dimmable CFLs. The EDCs should instead use these funds, as well as funds available due to the reduction in CFL incentives, to support expansion of the LED market. The EDCs must work with the Evaluation Committee to develop a strategy to monitor this market, through the use of carefully scoped evaluations. Therefore, the EDCs must examine this matter and submit revisions for program delivery in 2014 and For 2014 and 2015, the EDCs must demonstrate that the Retail Products Program has been modified to address changing market conditions. Such demonstration shall be submitted in accordance with the Compliance Schedule included in this Decision. The Retail Products Program for 2014 and 2015 must be redesigned by the EDCs and EEB to address the findings and recommendations contained in the Lighting Evaluation as well as the directives in this Decision. Chapter 2 YGS/CNG/SCG Performance Incentive exhibit Chapter 2 CL&P/UI Performance Incentive exhibit Chapter 3 PP

204 16 The Department directs that appliance rebates shall continue under HES as well as through the Retail Products Program to increase consumer awareness about the Top Ten USA website. Consumers should be fully informed about available technologies and their relative efficiencies regardless of fuel type. The Companies must develop information for use in HES and other programs. 17 The LDCs and EEB must propose program design changes to improve the cost-effectiveness of the Residential New Construction Program and submit recommendations to DEEP. 18 DEEP requires that an evaluation of the HES program be completed, and/or program design changes developed through the HES Innovation proceeding be adopted, before contingent funds are approved for use in 2014 and This evaluation must be submitted in accordance with the Compliance Schedule in this Decision. 19 DEEP therefore requests that the EEB reconsider whether the current copay for HES is appropriate, and whether such co-pay amounts should be increased in order to reduce the ratepayer subsidy for the program while not negatively impacting participation levels. Response: 2014 and 2015 Planning models that have been reviewed by EEB consultants and reflect current customer co-pays ($75 for electric and natural gas; $99 for deliverable fuels). 20 The Companies and EEB must develop marketing analyses and campaigns targeted to specific residential segments that are designed to foster a home performance industry, not just drive program participation in HES. The efforts should also encourage uptake of deeper measures, use of financing, and understanding of the concept and value of home performance.166 Therefore, the Department directs the Companies to include a plan in the 2014 Annual Update for the implementation of a marketing campaign to increase awareness about the concept and value of home performance. 21 The Companies and EEB should advance efforts to level the playing field by establishing standards for home energy performance professionals through licensing or registrations, requiring third-party certification, or an alternative standard-setting mechanism. The Companies must provide a progress report in the 2015 Annual Update. 22 The Companies must establish targets, as soon as practicable, for the number and type of deeper measures they intend to achieve through the HES program in 2014 and Based on the foregoing, the Department directs that the hundred cubic feet (ccf) savings per home goal increase by 8% in 2014 and by 10% in These goals are intended to be met through customer investment, not by increasing the number of homes served under the program. 24 The Companies and EEB must provide a plan to both certify HES service providers and integrate home energy labeling as part of the HES program. Chapter 3 PP 150 Chapter 3 PP Chapter 1 PP 2 See Response in this section Appendix II PP 201 Not applicable to this filing. Due 2015 Chapter 2 All Companies Table Bs and Performance Incentive exhibit Chapter 2 YGS/CNG/SCG Performance Incentive exhibit Chapter 3 PP

205 25 The Department approves an increased budget for the HES-IE program, in order to ensure that more income- eligible residents can access energy savings. The EDCs must work closely with the Community Action Agencies to increase HES-IE market penetration, and to consider opportunities for integrating HES-IE program implementation with implementation of the federal DOE Weatherization Assistance Program. 26 DEEP provisionally approves the budget for Residential Behavior and a separate budget for Customer Engagement funding for the EDCs subject to the following conditions: The Department directs CL&P to roll out a behavioral energy efficiency program in its service territory. However, to resolve the lack of clarity regarding cost effectiveness, prior to rolling out this program CL&P must verify the Residential Behavior program s cost effectiveness and report to the EEB and the Department about how this program will incorporate the Residential Committee s recommendations on program design and delivery. UI needs to clarify to the Department and the EEB their program plans for their Residential Behavior program and their Customer Engagement program in a summary of their program which distinguishes between its behavioral program aspects and customer engagement system aspects and identify which budget items UI intends to fund the UI program. Distinguishing between Residential Behavior spending and Customer Engagement spending will assist in future evaluations of cost effectiveness. 27 For 2013, the Department finds that CL&P s revolving loan fund balance is adequate to support this program. For 2013 the Department finds that UI s revolving loan fund balance is inadequate to support this program and directs UI to allocate $500,000 from the HES potential allocation to support loan activity through the end of the first quarter of The Companies are directed to review the results of program delivery customization with the C&I Committee. This review shall summarize the progress of the self- directed program, identifying the key parameters, the degree of consistency with the best practices described above, and whether additional steps or practices need to be taken in the implementation of self-directed programs. The Companies shall include a progress report of the program and summarize coordination efforts with the C&I Committee in the Annual Update to DEEP. 29 The Department directs that, as part of an expanded plan, a total of $5 million in ratepayer funds be allocated as finance capital for the SBEA loan program for each of the program years 2014 and The Marketing Committee should ensure that the scope and terms of this marketing services contract furthers the objectives outlined in the 2013 CES and in this Decision, and is harmonized with marketing efforts undertaken by CEFIA. To maximize efficiency, the Companies should be responsible for the day-to-day administration of the contract, with regular oversight and direction on major milestones from the Marketing Committee. Chapter 3 PP 163 Chapter 2 CL&P/UI Table Bs And Chapter 3 PP Chapter 2 UI Table A And Chapter 3 PP 158 Chapter 4 PP 181 Chapter 2 Table A1 (C&I self-funding line) Appendix II PP

206 31 The EDCs must develop tools to measure, for example, increased understanding of energy efficiency, peak demand, the benefits of lowering peak demand, time-of-day rates, renewable energy options, blower door testing, etc., pre and post SLC visit. The EDCs must also consider ways to track the energy consumption (electricity, gas, propane, and oil) of SLC visitors, potentially through an opt-in energy tracking program. Continued operation of the SLC beyond the initial term of the lease will include a review of the EDCs ability to demonstrate that the center is achieving these goals, including a review of the extent to which the SLC is used as a training center for other educators, such as interpretive staff at the museums in the Museum Partnerships. The EDCs must develop components of this program to encourage students and educators to reduce their energy consumption and bills, and track actual progress towards that goal. The Department recommends that the EDCs allocate sustained funding for Green LEAF and develop a plan to integrate the various school-based education programs to ensure that strengths from each program are maximized and any actual or perceived redundancies are minimized. The EDCs may determine an appropriate budget and report back to the Department within their 2014 Annual Update. 32 DEEP requires the Companies to submit to the Commissioner, no later than in the 2014 Annual Update, an updated proposal which revises, as appropriate, the consultant budget for the balance of 2014 and for By March 1, 2014, and annually thereafter, the Companies shall provide a summary of actual data for the previous program (calendar) year. If possible and practical, the Companies may provide such information prior to this deadline. This will allow more time for the Board to consider if any adjustments are warranted. If it is determined that the March 1, 2014 is not practical, then in future years the Companies and the EEB can develop a revised submittal schedule. Chapter 5 PP Chapter 2 All Companies Table As Chapter 2 All Companies Table As and Table Ds Also available on the dashboard website. 200

207 Appendix II Marketing Plan 201

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209 STATEWIDE MARKETING PLAN FEB 28,

210 I. INTRODUCTION In 1977, President Jimmy Carter declared that facing our nation s energy issues would require a level of effort that was the moral equivalent of war. He also said that if we fail to act soon, we will face an economic, social, and political crisis that will threaten our free institutions. While his sentiments may have been accurate, his punitive tone did not resonate with American consumers, and 37 subsequent years of exhorting, cajoling and scaring consumers has still not produced the needed results. The failure to achieve the deep energy savings goals that President Carter described has had a direct impact on our stakeholders with the most to gain or lose Connecticut s families and businesses. These primary stakeholders in the quest for a better energy future need to be convinced before they will buy into and act on the mission. The 2013 Connecticut Comprehensive Energy Strategy (CES) recognizes this challenge and states: The goal is to create a culture that understands the value of and therefore demands energy efficiency, establishes standards that enable consumers to easily ascertain the efficiency profile of their own homes or buildings, and makes financing for energy efficiency measures both easily accessible and affordable. 2 In support of this overarching goal, the Department of Energy and Environmental Protection (DEEP) has directed the Energy Efficiency Board (EEB) to develop and execute a Statewide Marketing Plan to enhance and support the ongoing Energy Efficiency Fund program marketing, complement the marketing efforts of the Clean Energy Finance and Investment Authority (CEFIA), and support the newly created Energize Connecticut brand and website. This Statewide Marketing Plan will include the building blocks needed to foster a culture change and will provide the supporting foundation for the program and measure-specific marketing addressed by Connecticut Light and Power, The United Illuminating Company and the gas utilities (the Companies) throughout the year. The development of this plan is timely for two reasons. First, Connecticut is on the cusp of a major ramp-up in program delivery, and expanded marketing and outreach is necessary to drive customer action. Second, Connecticut recently created the Energize Connecticut brand and website. These components are now at our disposal to aid in a strategic and vigorous marketing effort aimed at spurring customer action and shaping customer behavior. As such, this statewide marketing plan is part of a larger marketing investment (which includes ongoing program marketing) that is designed to help Connecticut deliver upon its aggressive energy saving goals. The building blocks in this plan include: Customer Research 2 Page

211 Customer Segmentation and Analysis EnergizeCT.com enhancements Utilities online energy efficiency customer engagement platforms The building blocks will inform and influence all our marketing efforts those detailed in this plan, as well as program marketing. This Statewide Marketing Plan will also include two public-facing communication campaigns: Energize Connecticut Enhanced Launch/Brand Awareness Demonstrating the Value of Energy Efficiency/Home Performance Additionally, there are several specific marketing objectives detailed in the C&LM Plan Final Decision. (See Appendix A.) In essence, most of them are variations on a theme to provide customers with information that is relevant to their individual needs and lifestyle so that they can make energyefficient decisions. A very strong start towards realizing the overall goal of creating a culture that values energy efficiency was made by the Marketing Services Committee (MSC) with the creation of the Energize Connecticut brand and website. The building blocks of this Statewide Marketing Plan are the essential next steps to the implementation of that goal and the program-specific objectives. Before we can influence thought and precipitate action within our programs, we need a thorough understanding of who our customers are and what they are thinking. Both residential and business segmentation analysis are already underway and are providing valuable insights that will enable us to target and differentiate our program messages. The research proposed in this plan will reveal what our customers are thinking at various points of exposure to our messaging, and the website enhancements and the customer engagement platform will make it easier for them to take action. The two communication campaigns detailed in the following pages are based on communication objectives that will shape how customers think about energy efficiency (and the Energize Connecticut brand), how they feel after encountering our messaging, and ultimately, what they will do with the information. A think-feel-do communication strategy is also known as a high-involvement model because it works best with product categories or situations where there is a need for information or where there is significant product differentiation; energy efficiency has both of those characteristics. While the two communication campaigns included in this statewide plan have specific objectives and strategies, they should be considered in a broader context which includes existing and planned program promotions, CEFIA s financing promotions, and the marketing communications messaging being produced by authorized contractors and certain trade allies. The Energize Connecticut brand is, for the most part, embedded into all of those entities messaging. This provides a platform for multiple customer touch points with certain unifying attributes. The communication campaigns detailed in this plan provide an opportunity to leverage the impact of the smaller-reach campaigns implemented by the individual market actors to a larger statewide audience. Promoting the values of the brand (including the credibility of the sponsors) and the values and benefits of energy efficiency and home performance reinforce all the other touch points, as illustrated in Figure

212 Figure 1. Multiple Touch Points Result in Customers Taking Action Not only should we view the customer touch points of this plan in a broader context, the funding associated with this Statewide Marketing Plan is also part of a larger marketing investment, which includes ongoing C&LM program marketing and an energy efficiency customer engagement platform. Although these are separate line items in the C&LM Plan Final Decision, the funding for this Statewide Marketing Plan was intended as a mechanism to enhance the overall marketing effort needed to support expanded C&LM programs and increased energy savings goals, as illustrated in Figure

213 Figure 2. Overall 2014 Energy Efficiency Marketing Investment 207

214 A summary of the Statewide Marketing Plan budget, including supporting resources, is shown in Figure 3. Additional details can be found in Section VIII of the Plan. STATEWIDE MARKETING PLAN BUDGET, INCLUDING SUPPORTING RESOURCES 2014 STATEWIDE MARKETING PLAN TASK Energy Efficiency Customer Engagement Platform BUDGETING CATEGORIES 2014 Statewide Marketing Plan Program Marketing resources used to support Statewide Marketing Plan CEFIA contribution to Satewide Marketing Plan* EE Customer Engagement Platform $ 750,000 $ 1,659,099 $ 770,000 $ - $ 3,179,099 Research $ - $ 59,300 $ 37,200 $ 11,500 $ 108,000 Segmentation $ - $ 78,400 $ - $ - $ 78,400 Website Enhancements $ - $ 101,983 $ 95,267 $ 65,750 $ 263,000 Website Yearly Maintenance $ 90,000 $ - $ 30,000 $ 120,000 Enhanced Brand Launch $ - $ 961,550 $ - $ 274,250 $ 1,235,800 Value of EE/Home Performance Campaign $ - $ 100,000 $ - $ - $ 100,000 TOTAL $ 750,000 $ 3,050,332 $ 902,467 $ 381,500 $ 5,084,299 TOTAL Funding Available: Approved in DEEP Final Decision $ 750,000 $ 3,050,000 Approved Electric (EDCs) $ 600,000 $ 2,440,000 Approved Gas (LDCs) $ 150,000 $ 610,000 *Proposed CEFIA co-funding for the enhanced brand launch campaign is being proposed to the CEFIA Board and is contingent on CEFIA Board review and approval. Total Available Funding $ 750,000 $ 3,050,000 $ 3,800,000 Figure 3. Statewide Marketing Plan Budget Summary with Supporting Resources An estimated timeline showing the months when the major activities of the Statewide Marketing Plan will occur is shown below on Figure 4. Figure Statewide Marketing Plan Estimated Timeline 208

215 II. MARKET SEGMENTATION AND ANALYSIS a. Overview Data mining, deep-dive analytics, and customer segmentation capabilities are being leveraged to gain a deep understanding of our customers energy usage behaviors, past program participation, demographic attributes and building profiles to better target customers with relevant bundles of products and services and to develop more compelling messaging and communications. A strong analytics foundation will enable us to continually test our marketing strategies and to hone our knowledge in order to improve both our product offerings and the ways in which we communicate programs and services. Recognizing this opportunity, the Companies have already begun building these capabilities. The Companies have added experienced staff, developed customer databases and acquired best of breed analysis tools. As part of this marketing plan, we will continue this work and leverage our findings to optimize messaging, marketing and communication efforts. b. Situation Analysis The Companies have embarked on robust segmentation strategies in both the commercial/industrial and residential arenas. The goal of this work is to develop segments of likeminded and behaving customers in order to focus and tailor our programs and drive customer action within those programs. While segmentation and analysis is an ongoing activity, commercial and industrial efforts to date have included both quartile and sector-based segmentation. (See Figure 5.) This work has enabled us to develop highly effective go-to-market strategies and tailored communication plans. Residential segmentation efforts are currently underway and will incorporate both a customer propensity to participate dimension and a physical structure opportunity dimension. (See Figure 6.) Residential segmentation will enable us to develop relevant bundles of products and services for each of the identified customer groups. (See Figure 7.) We will then optimize messaging, communication vehicles and calls to action for each of the segments. Leveraging robust segmentation strategies will aid the Companies in delivering increased and deeper program participation in a cost efficient manner. 209

216 Figure 5: NU C&I Customer Quartile and Sector Example Figure 6: The Type of Home Influences a Customer s Motivation to Act 210

217 Figure 7: Targeted Marketing 211

218 III. MARKET RESEARCH a. Overview Building brand awareness allows an entity to create a position in the marketplace, build a relationship with the customer and provide a product promise associated with a brand s products. Since the launch of the Energize Connecticut brand in 2012, three surveys have been completed to measure change in awareness of and interest in energy efficiency, renewable energy, and Connecticut s various clean energy brands. We will conduct additional research to measure pre- and post- campaign brand awareness to determine the effectiveness of the campaigns, to understand opportunities to strengthen the Energize Connecticut brand, and to improve current and future marketing efforts and campaigns. We will also conduct research to determine Connecticut consumers perceptions of efficiency and add-on measures. This research will help us to understand what factors can and will motivate consumers to increase their participation in programs, including Home Energy Solutions (HES), and in the adoption of add-on measures. Specifically, we will undertake the following research activities: 1. Research General Awareness: The EEB s 2013 study was a follow-up to the baseline survey conducted in August The 2013 survey saw minimal change in awareness on almost all levels measured. I. Pre-Campaign Survey: Prior to the launch of the Energize Connecticut Enhanced Launch/Brand Awareness Communication campaign (see Section V), a new awareness survey will be conducted. The survey will include questions from the 2013 surveys, along with additional questions pertinent to campaign content. This survey will launch approximately one week prior to campaign execution. II. III. Post-Enhanced Launch/Brand Awareness Campaign Survey: The same survey will then be executed one to two weeks after the close of the brand awareness campaign to determine any lift in awareness and/or the impact of the campaign s content. This information will assist the Companies in determining if messaging and media were on point with the objectives of the campaign and allow for adjustments to create more effective marketing in 2014 and Program End-of-Year Survey: A modified survey measuring program awareness will be executed in November 2014 to determine any lift in awareness of overall program marketing for the year. This survey will focus more on key messaging within program marketing such as Energize Connecticut, EnergizeCT.com, program awareness and recognition, and overall information awareness. 212

219 2. Research Customer Perception and Motivation: Consumers evaluate products on several levels including basic characteristics, advantages to the purchaser and valueadded features and benefits, including intangibles. Consumers are motivated to purchase based on their evaluation of determined value measured against the perceived risk. Personal values and characteristics also affect this evaluation. We will undertake research to explore these issues as it relates to participation in HES and addon measures and to improve marketing and communications efforts accordingly. I. HES Past Participant Survey: Research will be done to determine possible deterrents to program participation as well as positive motivators with the current HES and Home Performance customer participants. This research will include in-depth phone surveys of recent HES participants who were recommended additional efficiency measures, surveyed equally between those who have and have not chosen to participate in additional measures. Additionally, it will seek to determine how consumers beliefs and values affect this choice as well as any product factors that may have hindered or accelerated participation. For additional insight, the Companies will overlay demographic information over these research participants to determine any similarities or anomalies. This research will define current market effects on participation. II. HES Past Participant Focus Groups: Once the quantitative research described above is complete, focus group(s) will be utilized to gain deeper insight. This information will allow the EEB and the Companies to determine if product adjustments or marketing refocus may be required in order to increase participation. In addition, some online surveying may be executed to test the effectiveness of messaging and product features. 213

220 IV. WEBSITE OPERATIONS AND ENHANCEMENTS, AND TECHNICAL SUPPORT: EnergizeCT.com a. Overview As more and more consumers go online to seek information to inform their daily decisions, the role of digital media becomes increasingly more important. Maintaining a viable web presence is more than just having a website. The site needs to accommodate changes to consumers browsing technologies, be readily findable in engine searches, meet consumers expectations for content quality and timeliness, and improve the overall end user experience. The EnergizeCT.com website went live in January of During the past year the Companies, CEFIA, and DEEP have focused on transitioning from the original site developer to a site maintenance and development firm, addressing back-end functionality needs, establishing routine reporting, and implementing critical enhancements as identified by the EnergizeCT Web Committee. The EnergizeCT Web Committee is composed of staff from CL&P, UI, CEFIA and DEEP, with input from the EEB consultants. Throughout the year, the EnergizeCT Web Committee members maintain the website s content and graphics to ensure site freshness and support campaigns; and to integrate findings from segmentation, market research and website traffic analyses. Issues and enhancements identified during these day-to-day operations are immediately addressed or prioritized as an enhancement for implementation at a later date. b. Objectives For 2014, the efforts will focus on website maintenance and completing those identified enhancements that will: 1. Increase site traffic; 2. Reduce percent exits 3 ; 3. Increase average visit duration; 4. Enhance usability to facilitate consumers and contractors finding information; and 5. Enhance back-end functionality to facilitate day-to-day maintenance of the website. 3 The exit rate reveals how many people leave a site from a particular webpage. 214

221 c. Target Market The primary target market for 2014 continues to be residential consumers, followed by business consumers. An additional new market is contractors. With the shift toward upstream incentives, a portal for supporting contractors is planned to facilitate timely communication of program information. d. Project Implementations During 2013, the EnergizeCT Web Committee identified 27 enhancements recommended for the website. Of these, 6 have been completed and 2 are no longer needed, leaving a list of 19 enhancements. These enhancements include implementation of Search Engine Optimization (SEO); development of a Content Management System WIKI to provide online guidance to website Content Managers; implementation of responsive design to support website browsing on mobile devices; the creation of two wizards (financing and guided assistance to help visitors find the right programs); the development of a Contractor Portal; expansion of the Find a Professional feature; Air Qualify Widget upgrades; implementation of multi-lingual options; development of document and image libraries; implementation of a publishing and expiration date feature; and changes to solution and segment pages to facilitate finding programs. These enhancements will help to: 1) Improve the user experience; and 2) facilitate website maintenance. The Website Committee hopes to be able to complete all enhancements during In the event that economics, technical or other issues impede the implementation of all planned enhancements, the Web Committee has prioritized the enhancements. This prioritization, in combination with other marketing (brand launch) and seasonal factors, with will help to guide the schedule for developing and launching the enhancements. In addition, other content development and refinement changes are planned for These, in general, can be done by the Website Committee members and therefore do not require additional funding. During the first half of 2014, a usability study will be conducted to help inform planned and future user experience enhancements. Key questions related to the ability of the user to find the information they were looking for, ease of use of the navigation system, identification of missing features and content, and broad suggestions for changes, can all help to inform user-facing changes to the website. 215

222 Improve the User Experience Facilitate Website Content Development & Refinement Major Website Enhancements Planned for 2014 Enhancement/Benefit 1. SEO Optimizes a website based on how search engines work, what people search for, the actual search terms or keywords typed into search engines and which search engines are preferred by the targeted audience in order to facilitate users finding the website. This may include editing content, HTML and coding to both increase the website s relevance to specific keywords and to remove barriers to the indexing activities of search engines. This may also include promoting the website to increase the number of links. The Web Committee has two proposals and is in the process of seeking a proposal from SAI. 2. Wizards With more than 200 pages, and multiple entities contributing to the website content, assisting users in finding information and programs specific to their needs is needed. Two wizards have been identified to assist in the customer experience. I. The Finance Committee has requested a finance wizard to assist users in finding the right loan product for their project. II. With many residential consumers unaware of program specifics, a guided assistance wizard is proposed to help them find the right program. This would be a series of questions that result in a display of appropriate programs. 3. Find a Professional - This feature is being expanded to include lenders, loan programs, and restrict contractor demographic information to one record. Currently each contractor has a separate record for each program they participate in, which makes day-to-day maintenance of this information difficult. Other changes include the ability to upload and download partial lists of contractors. This enhancement will allow for better management of the information and maintain contractor data. 4. Air Quality Widget The current map and graph were developed a number of years ago, and the code needs to be updated. 5. Contractor Portal With an increased emphasis on upstream incentives, having a section of the website with programmatic information for contractors will be very useful. In addition to forms and training materials, this may also include an enewsletter. This enhancement will be key in keeping the contractor base informed and engaged. 6. Responsive Design Our Google Analytics reports show an exit rate of 50% for mobile users. More and more users are searching on mobile devices and the website needs to accommodate these users. This enhancement will keep Energize CT up-to-date with the growing population of mobile device users. X X X X X X X X X X 216

223 Improve the User Experience Facilitate Website Content Development & Refinement Enhancement/Benefit 7. Document and Image Library To facilitate day-today management of site content, a more robust document and image library is needed. This enhancement will allow administrators to keep the site from getting stale or redundant in use of content or imagery. 8. Publishing and Expiration Date This feature will allow pages and supplier choice rates to be set to automatically publish and expire on selected dates. This will facilitate yearly updates to program pages, time sensitive marketing content, and frequent supplier choice rate changes. 9. Landing and program pages modifications Informed by segmentation and market research, these change will highlight key program information and customer steps to take action. X X X X X 10. Supplier Choice Cross Marketing Add cross marketing features to the supplier choice pages to encourage these visitors to engage with the entirety of the website. X 11. What is Smart Energy section expansion Expand this section of the website to accommodate non energy efficiency and renewal energy program information, such as Energy Assistance, Comprehensive Energy Strategy summary information, transportation information, Natural Gas Expansion, etc. X 12. Energy efficiency and renewal energy house feature - This feature will display recommended measures and programs when a visitor hovers over sections of the home. X 217

224 IV. DEVELOPMENT AND LAUNCH OF UTILITY CUSTOMER ENGAGEMENT PLATFORMS a. Northeast Utilities (NU) Energy Efficiency Customer Engagement Platform Overview The NU energy efficiency customer engagement platform (CEP) is a tool that will allow NU to effectively reach all of its customers with energy usage information that is tailored to the customer and their situation, and includes self-service assessments (where applicable), as well as benchmarking. It will provide the customer with targeted, customized recommendations and actionable steps to reduce costs and save energy based on the customer s situation and profile. A customer, business or residential, will be able to see energy use over time, compare it with like customers in the area and segment, and learn about solutions that will save energy and money. The customer will also receive information about incentives tailored to them, which will help make these changes. The CEP will provide savings in the most efficient manner to each group of customers. It will enable NU to develop targeted messaging for these customers driving deeper and broader savings and improving customer satisfaction. The CEP will enable NU to close the marketing loop to learn more about these customers and develop better targeted products and services for them going forward, leading to additional savings over the long term. It will also provide a place the NU call centers can refer customers to for self-service. Additionally, with the CEP, NU will be able to collect metrics for reporting and analytics for evaluating program reach and effectiveness. By providing easy, intuitive and accessible resources and tools for customers to engage in transactional activities, informational searches and efficiency measures, NU will be able to keep pace with customers service expectations or industry norms. While NU customers are currently able to access their usage information via the Green Button 4, they do not have access to self-service tools to learn about energy efficiency information or access to customized program information. Current methods NU utilizes in providing customers with energy efficiency information is labor-intensive and costly, and does not reach all customer segments, nor do they provide customers with the control and immediacy they expect. This affects their ability to take actions that would save them energy and money. The magnitude of energy efficiency measures enacted is therefore affected, and adoption is not widespread across certain segments, especially smaller business, due to the costs of reaching this segment. This negatively impacts NU s ability to meet ambitious energy efficiency goals. The NU energy efficiency customer engagement platform will be implemented in CL&P example of the Green Button at 218

225 Figure 8. NU Energy Efficiency Customer Engagement Platform b. The United Illuminating Company customer engagement platform is under review and development, and is expected to be implemented in

226 V. ENERGIZE CONNECTICUT SM ENHANCED LAUNCH/BRAND AWARENESS COMMUNICATION CAMPAIGN a. Situation Analysis The new brand was developed by the Marketing Services Committee (MSC), which is made up of representatives from DEEP, the EEB, CEFIA and the Companies. Energize Connecticut was announced in the Spring of 2012 by Governor Malloy at the NEEP Summit and EnergizeCT.com went live in January, By the end of the first quarter of 2013, almost all of the Energy Efficiency Fund program collateral and advertising materials featured the new logo. As part of the new brand standards, the MSC developed a text descriptor that appears on most printed materials and on media releases to describe the initiative represented by the brand. By virtue of the volume of materials produced and distributed to the public and the frequency and reach of advertising and public relations pushed out via the Companies program marketing, CEFIA, and the trade allies, the new brand was introduced to Connecticut s residents, businesses and legislators. Now, with the major effort and investment of creating the brand and launching the website in place, and with the approval of an expanded C&LM budget, the stage is set for a larger brand launch. All of the brand s stakeholders have a vested interest in raising public awareness. The Energize Connecticut website is the primary call to action on all energy efficiency and finance program promotions. The public face of the Connecticut Energy Efficiency Fund has virtually disappeared. We need the public both residents and businesses to know and understand what the brand represents, as defined in our Brand Promise and Brand Pillars. Brand Promise: Empowering Connecticut to make smart energy choices, now and in the future Brand Pillars: Accessible, Inclusive, Trustworthy, Empowering The Opinion Dynamics telephone survey fielded in September 2013 reported that approximately half of Connecticut residents were aware of energy efficiency programs and one-fifth to onequarter was aware of renewable programs. This result is largely unchanged from a 2012 survey. We can therefore conclude that the awareness of many of our mature energy efficiency programs has topped out. The survey also reported that just eight percent of residential customers were very or somewhat familiar with the new brand. Considering that only a limited brand launch was done, it can be assumed that eight percent awareness was generated primarily via program marketing. The new brand offers us an opportunity to start moving that needle. The new brand gives us something new to talk about and an opportunity to introduce concepts that will ignite a renewed interest in past participants who may think they have been there, done that, and a chance to engage with people who have not been thinking much about energy usage. 220

227 b. Target Audiences While everyone who lives and works in Connecticut is a potential audience member, applying segmentation will enable us to match the message to the medium and to the appropriate geographic audience. c. Marketing Communications Objectives 1. To increase brand awareness. 2. To increase EnergizeCT.com traffic (primary call to action) and promote the statewide telephone information resource, WISE-USE (secondary call to action). 3. To position Energize CT as a trustworthy, credible endorser of smart energy resources. b. Marketing Communications Strategy The overall brand awareness marketing communications strategy is simple it is all about reach and frequency. In a concentrated period of time (early Spring), we will carpet bomb the public with the brand. While this intensity is time-constrained, the boost in brand awareness will support the concurrent and ongoing program marketing and energy efficiency/home performance campaigns, and, in turn, those campaigns will continue to extend brand awareness. 1. Media Sponsor. Implement a powerful multi-platform sponsorship (on TV, online, and through events) with one of the Connecticut television broadcast affiliates. A sponsorship would (a) provide broad reach to every demographic, (b) utilize a trusted messenger, and (c) have an immediate impact with a quick ramp up. NOTE: A TV affiliate sponsorship will complement the Companies program marketing, which includes a substantial increase in radio advertising in The program radio ads also feature the Energize CT brand and website. These radio spots will provide additional coverage in regions where the TV reach is light. This approach is recommended because: i. Production of a branding spot(s) produced by the sponsor would be far less expensive than creating them with an agency. ii. iii. Purchasing traditional TV advertising on a station-by-station basis fractures the overall buying power and incurs more expense. With a media sponsor, it is easier to control the flow of messaging short duration promotions can be launched and turned off easily. 221

228 c. Monitoring iv. With a media sponsor, we can incorporate the demand response/wait til 8 messaging in anticipation of the summer peak. 2. Public Appearance Opportunities with Brand Representatives. Seek out opportunities with the Governor, other legislators, commissioners and representatives from the EEB CEFIA, and the Companies to speak about Energize Connecticut at business locations and residential events (including those that are part of the media sponsorship). 3. Transit Advertising. Transit advertising (buses, train stations) is most effective for short, simple messaging. Deployment of the signage will be in urban locations. 4. Social Media. Social media will be the primary vehicle to announce new web enhancements the web is an extension of the brand. 5. Paid Search. Complement SEO efforts with paid search (keyword, content network general awareness/brand search. Technology and program search will stay with the program marketing budget). 6. Digital Display Advertising. In key sites including Facebook, Yahoo, Yahoo mobile media sites and on Connecticut sites where possible (DMV, dept of Revenue Services, etc.) 7. Direct Mail. Include logo and messaging in existing mail opportunities such as Motor Vehicle registration notices and Company utility bills. Monitoring of this campaign to evaluate the change in customer brand awareness will be performed via a pre-campaign survey and an end of year survey. (See Section III. Market Research) 222

229 VI. VALUE OF ENERGY EFFICIENCY/HOME PERFORMANCE CAMPAIGN a. Situation Analysis The Home Energy Solutions SM (HES) core services are a great entre to a household. As the program brochure states, it is the first step. However, all the Energize Connecticut stakeholders agree that these homes can and should be yielding deeper energy savings. The program administrators have collaborated with the EEB Residential Committee and the authorized contractors to create better tools to communicate the value proposition of upgrades to lighting, insulation, space heating and cooling, and water heating. Sales training has also been provided to the contractors to help with the upsell. Energy savings per home is now tracked on a contractor scorecard and there are penalties for contractors with low ratings. The expansion of the Clean Energy Communities program is also proving to be a useful communication channel. The multiple navigation options on EnergizeCT.com enabling customers to search by programs, solutions, or segments are another way to educate consumers on what is possible. All of these engagement strategies are working. In 2013, the comprehensive energy savings per home has increased 5. However, the Weatherization Baseline Assessment 6, commissioned by the Energy Efficiency Board, states that the evaluators determined 26% of the sampled homes (with a confidence interval of 21% to 31%) comply with the weatherization standard. So, we are faced with the challenge of modest increases not keeping pace with ambitious goals. The program administrators are facing a similar scenario in the small business customer segment. With increased savings goals in 2014 and beyond, more customers need to participate, but more importantly, greater savings need to be extracted from each project. Small business customers share many residential attributes particularly the lack of energysaving information. Unlike large businesses with facility managers and sustainability strategies, many small businesses simply aren t aware of savings opportunities, or they believe that if they have installed CFLs in the past decade, there is nothing else they can do. Promoting the concepts of value and performance with small businesses is also necessary. The Value of Energy Efficiency/home performance campaign is about planting a seed. Messaging and sales pitches about add-on measures and ROI mostly resonate with consumers who are predisposed to act (i.e., their equipment has failed or is likely to, or they are concerned about comfort or safety, and possibly they have environmental concerns). Promoting the concept of home performance (defined later in this document) lays the groundwork, or, to 5 The average single family home saved 12. MMBTU in 2012 and 14.1 MMBTU in Weatherization Baseline Assessment, NMR Group Inc., January

230 extend the previous metaphor, tills the soil and helps to create a receptive audience who is more likely make a smart energy choice when the opportunity arises. As with the branding campaign, this campaign plays off of the Companies program marketing, which has modified their program-specific messaging to include more experiential messaging as well. b. Target Audiences This is primarily a residential campaign. Small businesses are a secondary audience, but share enough of the same information gaps that a similar approach is warranted. The audiences for this campaign are the same as for the brand awareness campaign. Additional psychographic segmenting utilizing Experian data and other available resources will also be employed and will be useful in creating themes and identifying the Unique Selling Proposition (USP) as materials are being developed. (Filters may include categories such as do it yourselfers, environmentally sensitive, etc.) The insights we gained from completed surveys and the proposed past-customer survey (see Section III) will also help to match the campaign content to the correct segment. Additionally, while the messaging will be aimed at the end user, trade allies (including, but not limited to, home improvement contractors, property managers, realtors and landlords) are also both audiences and a vehicle to deliver the campaign messages to the end user. c. Marketing Communications Objectives 1. Increase number of engaged users on EnergizeCT.com 2. Generate media stories 3. Create a video library d. Marketing Communications Strategy In order to communicate the actions and resulting benefits of the value of energy efficiency and home performance to residential (and certain small business) consumers, we need to define the concept in terms of what we want our campaign outcomes to be. Home performance is an amorphous statement its overuse is starting to rival that of green energy, turning it from a useful phrase to a less meaningful buzzword. The Federal Department of Energy (DOE) defines home performance as: A whole house process using diagnostic measurements to determine calculated energy savings predictions for packages 224

231 of measures that are verified through post-retrofit testing and reviewed for quality installation. 7 This definition is useful for contractors and energy efficiency program administers, but how would it translate to consumer messaging? Efficiency First, a nonprofit trade association representing the home performance workforce, does a better job of turning the DOE description into a consumer-friendly concept: Home Performance A comprehensive whole-house approach to identifying and fixing comfort and energy efficiency problems in a home. A drafty house, rooms that are too hot or too cold, and high energy bills are all common issues for homeowners. A quality installation of a new heating or air conditioning system, buying replacement windows, or adding more insulation may fix part of the problem, but home performance looks at the entire package, including energy efficiency, comfort, durability, cost and health and safety. 8 Ed Voytovich, contributor to Remodeler magazine may have the definition that best describes what we need to convey to Connecticut residential consumers. Home performance is the science and practice of building and improving homes according to a comprehensive package of measures that make the home as safe, comfortable, efficient, and durable as possible. Each home is a distinctive system involving the building itself, the mechanical equipment, and the occupants. 9. The Voytovich description aptly lists the topics that we need to focus on: the building itself, the mechanical equipment and the occupants. Our communications strategy needs to be built around the value, benefits and opportunities associated with all three of those main topics, rather than the promotion of the phrase home performance. The inclusion of the occupants is the X factor that is often left out of energy-related messaging. Traditional energy efficiency promotions center on saving energy. By adding the human X factor, we can focus on how our customers use energy. Susan Mazur-Stommen, Behavior and Human Dimensions Program Director for the American Council for an Energy-Efficient Economy (ACEEE), is an advocate of utilities providing a more customized energy efficiency experience that delivers a branded product rather than an invisible commodity. At an E-Source conference presentation 10, she explained the importance of the User Experience, or UX, where the constraints are assumed to be solely technical or

232 economic in nature, when in reality, customer behavior is dictated more by user needs. She suggests that we fold into the user experience (UX) and integrate with the user s pre-existing complex of behaviors and activities, rather than forcing users to change them to accommodate a new product, service, or process. In other words, the concept that we want to express to customers is that your household the structure -- including everything and everyone in it is a system. How the system performs is effected by many things (structure, equipment, usage), and that performance has value. Our communications strategy will be user-based and personal. 1. Produce and promote video library. A series of very short videos on topics centered on the use of technology, equipment, human behavior, and resources (including financing). Videos should put the savings into real-life context If you replace your 15-year old washer with Top Ten USA rated model, in 6 months you could save enough to pay for XX bottles of laundry detergent (showing the bottles stacked up). Videos will include available resources financing, instant or traditional rebates, learn more resources (ENERGY STAR, Top Ten, etc.). Videos on renewable solutions could also be produced and tied to a lifestyle message that would include other smart strategies (such as tips to reduce consumption, or weatherization before going solar, etc.). The videos become the content for most of the campaign. Descriptions and excerpts of the scripts can be used in the promos (in blurbs on web pages, in media releases, as Facebook and Twitter content). This video strategy will complement the program-specific marketing campaigns executed by the Companies and CEFIA s financing communications. Those campaigns include similar messaging. The creation and promotion of this video library gives us a vehicle to go deeper with information, and an opportunity to provide the information in a way that is engaging and easy to access. Energy Efficiency program advertising always includes a call to action to go to EnergizeCT.com or 877-WISE-USE to learn more. Now, when visitors get to the site, they will have substantially more information and a better understanding of the value of energy efficiency and how it factors into their home s performance. These videos will also provide an opportunity to include financing as a support message with many of the topics. The videos will be produced using the NU in-house video facilities and the production capabilities of the Companies marketing specialists. Using those resources rather than bringing in an outside production company will enable the budget to support the creation of approximately twice as many videos, resulting in a campaign that will provide big results without big bucks. 226

233 Sample Video Topics -- more to be added as necessary. Topic HES Overview Weatherization/Sealing Insulation and energy savings Hot water and hot water equipment Lighting and Top Ten appliances Heating equipment/rebates Cooling equipment/rebates Behavioral changes of the homeowner Financing efficiency upgrades Windows Building energy efficient homes Low-cost/no-cost actions for small businesses Renewable topic About EnergizeCT.com About customer engagement platform Energy Efficiency and Natural Gas Conversions Building Energy Labeling Primary Audience Residential customers Residential customers Residential customers Residential customers Residential customers Residential customers Residential customers Residential customers Residential customers Residential customers Residential customers Small Business Customers Residential customers Residential & Business customers Residential &Business customers Residential customers Residential & Business Customers i. Include links from Energize CT You Tube channel to the webs site (or directly to the appropriate customer engagement tool). Users visiting the site directly will have a reason to stay longer (i.e., increasing engagement). ii. iii. iv. Promote videos via existing or new e-newsletters. Promote videos via social media. Promote videos via authorized HES and SBEA contractors (i.e., links on their company pages and newsletters). v. Promote videos via PR (see No. 3 below). 2. Promote EnergizeCT.com user tools and the Utilities online customer engagement platforms. As with the video library, these engagement tools are another way to reinforce the value message. This campaign will provide the means to promote these new customer resources. i. Via external affiliate links, internal links, social media and PR. 3. Public Relations. The PR efforts of the Companies will continue to focus on program participation. This value campaign is a separate complementary strategy, based on promoting the concept via the videos. We will distribute the videos with accompanying articles to: 227

234 i. Legislators ii. iii. iv. Contractors (matching content to appropriate trade) Trade and professional associations (including chambers) Community action agencies v. Local media vi. Municipal energy task forces via the Clean Energy Communities program. e. Monitoring Monitoring of this communications campaign will include web traffic analysis, earned media tracking, and the execution of a mid-campaign internet panel survey to determine interest in the completed/released videos and gauge interest in additional topics. 228

235 VII. ORGANIZATION, IMPLEMENTATION, AND MARKETING RESOURCES A. Statewide Marketing Plan Implementation Team & Resources The Northeast Utilities and United Illuminating s marketing teams, as administrators of the Energy Efficiency Fund/C&LM programs, will implement the 2014 Statewide Marketing Plan, in coordination with DEEP and CEFIA, and with the EEB Marketing Committee providing regular and ongoing oversight and direction of the Marketing Plan s major activities and milestones. For detailed information on the Companies marketing staff, resources, and capabilities, please see Attachment B. In addition to these resources and capabilities, the Companies will complement their teams with expertise provided by the following firms: 1. SAI Systems (SAIS), a technology consulting services firm based in Shelton, Connecticut. SAIS brings expertise in website maintenance and development. Since the summer of 2013, SAIS has worked in partnership with the Website Committee to support and enhance the Energize Connecticut website. SAIS will continue this work, including website technical support and implementation of website enhancements. 2. Gaffney Bennett Public Relations (GBPR), a full-service public relations and strategic communications firm based in New Britain, Connecticut. GBPR brings expertise in media relations, social media, online communications, and public opinion research. NU currently engages GBPR to support program marketing. As part of the Statewide Marketing Plan, GBPR will support public relations and certain research activities. 3. Boathouse Group, Inc., NU's integrated marketing communications agency of record. Boathouse provides broadcast media strategy and purchasing services for all of NU, including the C&LM department, and also produces and manages digital display, paid search and print advertising campaigns that support energy efficiency programs. 4. Mason, Inc., UI's integrated marketing communications agency of record. Mason provides broadcast media strategy, paid search, radio, TV and print advertising purchasing services for UI s C&LM department. Additionally, Mason provides public relations services and social media support for the energy efficiency programs on a joint level for Energize Connecticut. 5. Market Research Services: Competitive quotes will be obtained from market research firms with prior experience working with the Companies and the EEB for the execution of the studies listed in the Statewide Marketing Plan. In addition to these firms, the Companies plan to engage the following additional resources: 229

236 1. A media sponsor will be engaged for the Enhanced Brand Launch in order to implement a multi-platform sponsorship (on TV, online, and through events) with one of Connecticut s television broadcast affiliates. 2. A visual design firm will be engaged to provide creative support for website enhancements, including the look and feel of web-based guided assistance wizards. B. Statewide Marketing Plan Monitoring and Oversight 1. Role of the EEB Marketing Committee As directed in DEEP s C&LM Plan Final Decision, the EEB Marketing Committee will provide regular and ongoing oversight and direction of the Statewide Marketing Plan s major activities and milestones. 11 In order to provide this regular oversight, the EEB Marketing Committee will convene at least once monthly. More frequent review, monitoring, and supervision will occur through: a) EEB and EEB consultant participation in the Marketing Services Committee, the Website Committee, and other relevant Committees; and b) regular communications and meetings between the EEB s marketing consultants and the Companies. 2. Role of the Marketing Services Committee The Marketing Services Committee (MSC) was established during the Energize Connecticut brand and website development project and includes representatives from the DEEP, CEFIA, EEB, and the Companies. During the height of the project, the Committee convened weekly to discuss project developments and to coordinate work between all participating entities. The MSC also created several subcommittees (such as the Website Committee and Social Media Committee) to further coordination. These subcommittees continue to meet regularly. As the Statewide Marketing Plan activities commence, the MSC will again serve as the forum for regular marketing coordination and communication, especially for the three activities jointly-funded by CEEF and CEFIA (research, website enhancements and technical support, and the enhanced brand launch). During the height of the Statewide Marketing Plan activities, it is anticipated that the MSC will meet weekly. The MSC subcommittees will also continue to meet regularly to coordinate on the website and social media. Additional subcommittees may form, as appropriate. 11 See Page 104 or the C&LM Plan Final Decision. 230

237 Finally, the EEB Marketing Committee understands that DEEP may secure additional resources as necessary to help integrate the Statewide Marketing Plan activities with other agency efforts and to facilitate the harmonization of the Statewide Marketing Plan activities with CEFIA s marketing efforts. C. Role of Potential Additional Marketing Consultant per the C&LM Plan Final Decision The C&LM Plan Final Decision directs the EEB Marketing Committee to consider a marketing services contract to further the objectives of the Final Decision and the Comprehensive Energy Strategy. 12 In place of executing a contract with an outside marketing firm, the EEB Marketing Committee recommends that the Companies marketing teams implement the Statewide Marketing Plan, with the additional support and expertise provided by the outside marketing firms outlined above. This recommendation is informed by the following considerations: 1. The Companies marketing teams, in coordination with CEFIA, and with the additional support and expertise provided by the outside marketing firms, bring considerable marketing expertise to implement the Statewide Marketing Plan, including familiarity and experience with the Connecticut marketplace, the Connecticut consumer, and Connecticut s energy efficiency and renewable energy programs. 2. The Companies marketing teams have a track record of working collaboratively and closely with DEEP, CEFIA, and the EEB Marketing Committee. This history will help to facilitate the EEB Marketing Committee s oversight of the 2014 Statewide Marketing Plan s major activities and milestones as directed in the C&LM Plan Final Decision. 13 Furthermore, prior collaboration will aid in the harmonization of CEFIA s existing marketing efforts with the Statewide Marketing Plan activities (as directed in the Final Decision 14 ). 3. Leveraging the marketing staff, resources, and capabilities of the Companies will be more cost efficient than engaging an outside marketing firm. The two public-facing communication campaigns detailed in this plan rely heavily on those resources and abilities. In particular, the video strategy of the value campaign is budgeted on the 12 See Pages or the C&LM Plan Final Decision. 13 Ibid. 14 Ibid. 231

238 assumption of using the NU in-house video facilities and the production capabilities (including storyboards and scripting) of the Companies marketing specialists. 4. Implementation of the Statewide Marketing Plan by the Companies will ensure a more timely execution of proposed activities, as engaging an outside marketing firm will require time for a solicitation and approval. More significantly, a substantial (and costly) block of time would be needed to educate the selected firm on Connecticut s audiences (including a review of the recent public awareness studies), past marketing activities, current objectives (including the relevant legislation), the programs themselves, and the current, ongoing program marketing activities. 5. Implementation of the Statewide Marketing Plan by the Companies will ensure seamless integration with the ongoing program marketing campaigns that they currently plan and execute. 6. An outside marketing firm was previously engaged to develop the Energize Connecticut brand and website. Very comprehensive messaging and graphic guidelines were produced as part of that effort. Those foundational components were developed so that Connecticut s award winning smart energy programs and partners would have consistent, cohesive and effective turnkey marketing tools that could be applied to all public-facing communications. Now that they are fully developed, they are at the Companies disposal and are ready to be applied to the Statewide Marketing Plan in order to spur customer action and shape customer behavior. 232

239 VIII. BUDGET STATEWIDE MARKETING PLAN BUDGET, INCLUDING SUPPORTING RESOURCES 2014 STATEWIDE MARKETING PLAN TASK Energy Efficiency Customer Engagement Platform BUDGETING CATEGORIES 2014 Statewide Marketing Plan Program Marketing resources used to support Statewide Marketing Plan CEFIA contribution to Satewide Marketing Plan* EE Customer Engagement Platform $ 750,000 $ 1,659,099 $ 770,000 $ - $ 3,179,099 Research $ - $ 59,300 $ 37,200 $ 11,500 $ 108,000 Segmentation $ - $ 78,400 $ - $ - $ 78,400 Website Enhancements $ - $ 101,983 $ 95,267 $ 65,750 $ 263,000 Website Yearly Maintenance $ 90,000 $ - $ 30,000 $ 120,000 Enhanced Brand Launch $ - $ 961,550 $ - $ 274,250 $ 1,235,800 Value of EE/Home Performance Campaign $ - $ 100,000 $ - $ - $ 100,000 TOTAL $ 750,000 $ 3,050,332 $ 902,467 $ 381,500 $ 5,084,299 TOTAL Funding Available: Approved in DEEP Final Decision $ 750,000 $ 3,050,000 Approved Electric (EDCs) $ 600,000 $ 2,440,000 Approved Gas (LDCs) $ 150,000 $ 610,000 *Proposed CEFIA co-funding for the enhanced brand launch campaign is being proposed to the CEFIA Board and is contingent on CEFIA Board review and approval. Total Available Funding $ 750,000 $ 3,050,000 $ 3,800,000 CL&P, YANKEE GAS 2014 STATEWIDE MARKETING PLAN TASK Energy Efficiency Customer Engagement Platform BUDGETING CATEGORIES 2014 Statewide Marketing Plan Program Marketing resources used to support Statewide Marketing Plan CEFIA contribution to Statewide Marketing Plan* EE Customer Engagement Platform $ 530,000 $ 950,000 $ 770,000 $ - $ 2,250,000 Research $ - $ 27,600 $ 37,200 $ 5,750 $ 70,550 Segmentation $ - $ - $ - $ - $ - Website Enhancements $ - $ 62,533 $ 95,267 $ 32,875 $ 190,675 Website Yearly Maintenance $ - $ 72,000 $ 15,000 $ 87,000 Enhanced Brand Launch $ - $ 658,200 $ 137,125 $ 795,325 Value of EE/Home Performance Campaign $ - $ 60,000 $ - $ 60,000 TOTAL $ 530,000 $ 1,830,333 $ 902,467 $ 190,750 $ 3,453,550 TOTAL UI, CNG, & SCG BUDGETING CATEGORIES 2014 STATEWIDE MARKETING PLAN TASK Energy Efficiency Customer Engagement Platform 2014 Statewide Marketing Plan Program Marketing resources used to support Statewide Marketing Plan CEFIA contribution to Statewide Marketing Plan* TOTAL EE Customer Engagement Platform $ 220,000 $ 709,099 $ - $ - $ 929,099 Research $ - $ 31,700 $ - $ 5,750 $ 37,450 Segmentation $ - $ 78,400 $ - $ - $ 78,400 Website Enhancements $ - $ 39,450 $ - $ 32,875 $ 72,325 Website Yearly Maintenance $ 18,000 $ - $ 15,000 $ 33,000 Enhanced Brand Launch $ - $ 303,350 $ - $ 137,125 $ 440,475 Value of EE/Home Performance Campaign $ - $ 40,000 $ - $ - $ 40,000 TOTAL $ 220,000 $ 1,219,999 $ - $ 190,750 $ 1,630,

240 IX. APPENDIX A. Language And Compliance Schedule From The C&LM Plan Final Decision Pertaining To Marketing Page Numbers Sector (if applicable) Program, Activity or Initiative (if applicable) Language from the C&LM Plan Final Decision Pertaining to Marketing 42 Residential Retail Products 44, 47 Residential Retail Products 45 Residential Retail Products 45 Residential Retail Products The Department believes that a significant increase in the budget for the Residential Retail Products program for 2014 and 2015 is warranted. Specifically, the budget needs to be increased to allow for a concerted educational and marketing effort to catalyze investment in efficient lighting especially solid state lighting, more commonly referred to as light emitting diodes (LEDs). With enough progress in market movement, ratepayer support for residential lighting might be able to be reduced in The Evaluation also recommended increased educational efforts about the diversity of efficient lighting options, the impact of Federal lighting standards, and the meaning of terms like lumens, cool white, warm white, etc., utilizing visual and hands on displays...the Retail Products Program for 2014 and 2015 must be redesigned by the EDCs and EEB to address the findings and recommendations contained in the Lighting Evaluation as well as the directives in this Decision. The Lighting Evaluation reveals that that assumption is no longer the case. Of particular concern is the Lighting Evaluation s finding that socket penetration has not significantly increased despite the sale of 12.6 million program supported CFLs over the last three years. This finding suggests that much of the lighting being discounted under the program is being purchased to replace existing CFLs (i.e., repeat sales). This finding requires the EDCs to better target the market segment that has not yet replaced incandescent bulbs throughout their home. Education should also be increased at the point-of-purchase during high-traffic periods and at as many locations as 234

241 possible. Although this effort will initially be done by the EDCs and their support staff (e.g., lighting vendors), to achieve economies of scale the staff at retail outlets must also be trained. 46 Residential Retail Products 47 Residential Retail Products 49 Residential Appliance Rebate Program 49 Residential Appliance Rebate Program 51 Residential Home Energy Solutions NCPs should place greater emphasis on stakeholder marketing support and assignment of higher markdown incentives for partners who support efficiency efforts. The Department supports the continued use of incentives to affect transformation of the residential lighting market in the near term. Repeating past marketing strategies may not be targeting the market segment that is unlikely to invest in CFLs. Therefore, the EDCs must examine this matter and submit revisions for program delivery in 2014 and The Department supports expanding education and targeting marketing to better inform consumers about their lighting options. Expanding education should increase awareness and in turn drive consumer demand for these products, providing additional opportunities to reduce incentives. Lighting Fairs may need to shift their focus from CFLs to LEDs and education as their primary mission. The Department directs that appliance rebates shall continue under HES as well as through the Retail Products Program to increase consumer awareness about the Top Ten USA website. Consumers should be fully informed about available technologies and their relative efficiencies regardless of fuel type...the Connecticut Energy Efficiency Fund should then offer incentives for efficient equipment regardless of the existing fuel. Therefore, the Companies must develop information for use in HES and other programs. The Companies state that an increase in the marketing of the program will be required at every junction so as to continually attract more customers to utilize the program and to better use that initial engagement to make the value proposition that will get customers to directly invest in or finance the additional efficiency measures recommended by the vendors without as much or any ratepayer subsidy. 235

242 55 Residential Home Energy Solutions 59 Residential Deeper Measures & Natural Gas Conservation 60 Residential Home Energy Solutions Income Eligible The Companies and EEB must develop marketing analyses and campaigns targeted to specific residential segments that are designed to foster a home performance industry, not just drive program participation in HES. The efforts should also encourage uptake of deeper measures, use of financing, and understanding of the concept and value of home performance. Therefore, the Department directs the Companies to include a plan in the 2014 Annual Update for the implementation of a marketing campaign to increase awareness about the concept and value of home performance. DEEP has increased the annual marketing budget to implement such a campaign and other marketing/educational efforts discussed throughout this Decision. Although there are some savings associated with deeper measures (e.g., additional insulation, HVAC equipment) that are embedded in the totals, the Department believes much more can be done to encourage the investment in additional deeper measures and thereby achieve greater savings, i.e., increased goals. This effort must be supported by a significant marketing campaign to be undertaken around residential energy efficiency, specifically Home Performance. Improving the marketing of this program will be critical to ensure that customer demand increases with the availability of increased funding for the program. The Department believes that one of the best ways to target HES-IE customers and inform them of the services available is for the EDCs to work closely with the Community Action Agencies. The Community Action Agency staff members have had lengthy interactions with clients and can discuss HES-IE services and benefits in depth and can act as an important liaison between the customer and the EDC. The EDCs must work closely with the Community Action Agencies to increase HES-IE market penetration, and to consider opportunities for integrating HES-IE program implementation with implementation of the federal DOE Weatherization Assistance Program. 236

243 61 Residential Home Energy Solutions Income Eligible 61 Residential Home Energy Solutions Income Eligible 62 Residential Home Energy Solutions Income Eligible Residential Home Energy Solutions Income Eligible UI currently contacts its Matching Payment Program (MPP) participants by mail. The company does this on a monthly basis and all new MPP participants are contacted. CL&P stated that it would consider a similar marketing effort. The Department recommends that CL&P undertake such a direct mail campaign for MPP customers and notes that CL&P is in the process of segmenting its residential customer data so that it can more strategically target its residential customers. CL&P is presently holding strategic planning sessions to determine how to better use customer contact interactions, both via the web and its customer call center, to present efficiency programs and opportunities to all customer segments including HES-IE customers. UI is utilizing its DROID field tool to provide accurate, timely information to customers in the hope of encouraging deeper efficiency measures. UI is also in the process of adapting its DROID tool so that it can be used as a Department of Energy approved assessment tool for the Weatherization Assistance Program (WAP) and income eligible customers. The Department supports these efforts and encourages the EDCs to share the results of these efforts with each other to increase services to HES-IE customers. Both companies agree that the success rate of efforts to reach absentee landlords will continue to make access to all eligible households difficult, but that renewed attempts to make contact and inform landlords of the benefits of high efficiency equipment and reduced maintenance costs may improve the situation. Marketing, outreach, and education should be cornerstones of the HES-IE program and the use of a multi-prong approach that includes Community Action Agency involvement, vocational-technical education programs, door-to-door canvassing, local housing authority contacts, CHFA quarterly meetings, educational events, MPP participant education, and customer contact information are all necessary to ensure that conservation programs are equitably serving all classes of customers. 237

244 65 Residential Residential Behavioral Energy Efficiency, Customer Engagement 68 Residential Residential Financing DEEP supports a behavioral energy efficiency program which is harmonized with the Companies respective customer engagement programs, particularly if integrated into utilities existing customer relationship systems. A variety of financing products with slightly different eligibility criteria and credit requirements are becoming available to Connecticut s residents. These products include, but are not limited to, the Energy Conservation Loan and Connecticut Energy Efficiency Fund Revolving Residential Loan Fund, described below; the Smart-E residential financing product recently developed by CEFIA and offered through credit unions and community banks through most of the state; the Cozy Home Loan, launched as a pilot by HDF for incomeeligible homeowners; a residential furnace and boiler replacement program slated to launch in the heating season, pursuant to Connecticut Public Act ; and an on-bill financing program to be developed and administered by CEFIA pursuant to Connecticut Public Act The presentation of these multiple financing options must be made as simple and seamless as possible for the customer, through vendor training, coordinated marketing, and simplified presentation on The ratepayer-supported C&LM financing products should be positioned in the market in such a way that they do not undermine financing products offered by the private market Commercial & Industrial N/a The 2013 CES determined that the C&LM programs should focus on broader participation in hard-to-reach sectors. This includes medium-to-small customers and small manufacturing. The 2013 CES established a priority to provide the industrial sector with deeper, comprehensive energy services and specialized efficiency programs to improve industrial processes... To achieve broader and deeper savings, the EEB, the Companies and the Department have developed the following strategic priorities to accomplish these aims...customer segmentation and enhanced customer focus to reach underserved markets...promotion of strategic 238

245 energy management for businesses 70 Commercial & Industrial 71 Commercial & Industrial 71 Commercial & Industrial N/a N/a Small Business Energy The C&LM Plan prioritizes reaching customer segments and improving customer focus as a means to reach underserved markets...clearly, the challenge is to ensure that all commercial and industrial customers are aware of the energy efficiency programs and their benefits and are encouraged to participate...the Companies and the C&I Committee have taken important steps toward reaching underserved markets by providing market data analyses as part of monthly C&I meetings. As part of this data analysis, a market analysis study by Energy Market Innovations, Inc. (EMI) provided key information to enable the Energy Opportunities (EO) and Energy Conscious Blueprint (ECB) programs to target remaining savings opportunities and to encourage additional comprehensive energy efficiency projects. Additionally, the Companies must address the need to provide separate accountings that distinguish the different cost and benefits of participation in efficiency programs for public-sector institutions and private-sector businesses. Based on its market analysis, EMI s findings and recommendations include...the Companies should increase efforts to engage manufacturing facilities to complete additional comprehensive projects as a part of the ECB program...educational and health care facility s segments present additional opportunities for the ECB program to achieve cost-effective savings...retail and office building segments account for a significant portion of savings in the EO program. Although it is possible that that there are limited opportunities, given retail and office building operations, the Companies should target these segments as part of the comprehensive initiative...industrial facilities have had lower participation rates in comprehensive projects in the ECB program, and represent a potential area of increased participation... Small Business Energy Advantage (SBEA) Data Mining Evaluation...The purpose of the study is to assess market sectors that are highly represented and underrepresented among SBEA participants, characterize the composition of 239

246 72 Commercial & Industrial 74 Commercial & Industrial Advantage N/a N/a installed measures (lighting only, comprehensive, etc.), evaluate the customer experience, and measure the levels of savings by SBEA sector. The Department supports continued use of market trend analyses by independent evaluators and by the Companies as an important component in broadening participation among all market segments, sizes and types of business customers. It is important that the OEEB be closely coordinated with the C&LM C&I programs. This will ensure that underserved businesses are incorporated into C&LM program administration, and also ensure that the market segment analysis currently being developed for the C&LM program is shared to enable the OEEB to target underserved communities N/a 2014 Marketing Plan 78 N/a 2014 Marketing Plan 78 N/a 2014 Marketing Plan The Marketing Plan centers on the newly-created Energize Connecticut brand. This public-facing brand represents programs and services supported by the Energy Efficiency Fund, the State, and CEFIA...Existing and new materials will carry the Energize Connecticut brand in 2013 and beyond. Several stakeholders expressed concern that expanded marketing, especially around HES, would increase program participation beyond that which can be supported under available funding. The increased marketing budget is not solely for program marketing. These funds are meant for improvements to the website, to increase awareness about the benefits of energy efficiency, educate consumers about the concept of home performance, peak electric demand and to develop the tools and market segmentation data necessary to drive deeper savings. Increased investment in market research and marketing tools like the Energize Connecticut brand will be needed to increase customer awareness of the value of the services currently provided through HES. This effort must also begin to educate consumers about the value of energy labeling. This in turn should drive demand for these services allowing an increase to the co-payment as the market transforms. The home 240

247 performance industry must participate in and support this effort. 78 N/a 2014 Marketing Plan N/a 2014 Marketing Plan 80 N/a Education, SmartLiving Center The Energize Connecticut brand and website are important, foundational steps towards the 2013 CES goal of developing the marketing and communications tools needed to reach ambitious energy efficiency goals. DEEP, therefore, approves an increased budget for the Marketing Program above the amount requested by the Companies. This increased budget should be used to fund the next phase of...the improvements to and particularly for the residential sector. As acknowledged in the 2013 CES, different sub-segments of consumers face different barriers that prevent them from benefiting from programs and incentives that could help lower their energy costs. 138 This strategy should inform all aspects of C&LM program implementation, including the design of programs (e.g., positioning rebates or financing products to encourage bundling of deeper measures), the delivery of programs (e.g., through community-based approaches, time-limited and seasonally-tailored campaigns, partnerships with state and local government), and the development of collateral and messages targeted to persuade specific customer segments, especially those customer segments that are traditionally underserved by the C&LM programs. The Marketing Committee should ensure that the scope and terms of this marketing services contract furthers the objectives outlined in the 2013 CES and in this Decision, and is harmonized with marketing efforts undertaken by CEFIA. To maximize efficiency, the Companies should be responsible for the dayto-day administration of the contract, with regular oversight and direction on major milestones from the Marketing Committee. The EDCs must develop tools to measure, for example, increased understanding of energy efficiency, peak demand, the benefits of lowering peak demand, time-of-day rates, renewable energy options, blower door testing, etc., pre and post SLC visit. 241

248 81 N/a Education, SmartLiving Center 82 N/a Education, eesmarts, Green LEAF Schools Education must be expanded to increase awareness among consumers about energy efficiency and to transform markets for the products needed to achieve the state s energy goals. Therefore, the Department finds that continuation of the SLC will provide a significant and necessary educational resource in Connecticut s efforts to achieve its goals. Similar to the performance requirements identified for the SmartLiving Center the EDCs must develop components of this program to encourage students and educators to reduce their energy consumption and bills, and track actual progress towards that goal. Compliance Schedule from the C&LM Plan Final Decision Pertaining to Marketing Page Number Compliance Item Program, Activity or Initiative (if applicable) Condition Retail Products Retail Products Retail Products Appliance Rebates Appliance Rebates The EDCs shall better target the market segment that has not yet replaced incandescent bulbs throughout their home. The Department directs the EDCs to update the Plan to focus on the LED market The Retail Products Program for 2014 and 2015 must be redesigned by the EDCs and EEB to address the findings and recommendations contained in the Lighting Evaluation as well as the directives in this Decision. The Department directs that appliance rebates shall continue under HES as well as through the Retail Products Program to increase consumer awareness about the Top Ten USA website. Consumers should be fully informed about available technologies and their relative efficiencies regardless of fuel type. The Companies must develop information for use in HES and other programs. 242

249 Home Energy Solutions Home Energy Solutions Income Eligible Marketing Plan The Companies and EEB must develop marketing analyses and campaigns targeted to specific residential segments that are designed to foster a home performance industry, not just drive program participation in HES. The efforts should also encourage uptake of deeper measures, use of financing, and understanding of the concept and value of home performance.166 Therefore, the Department directs the Companies to include a plan in the 2014 Annual Update for the implementation of a marketing campaign to increase awareness about the concept and value of home performance. The Department approves an increased budget for the HES-IE program, in order to ensure that more income-eligible residents can access energy savings. The EDCs must work closely with the Community Action Agencies to increase HES-IE market penetration, and to consider opportunities for integrating HES-IE program implementation with implementation of the federal DOE Weatherization Assistance Program. The Marketing Committee should ensure that the scope and terms of this marketing services contract furthers the objectives outlined in the 2013 CES and in this Decision, and is harmonized with marketing efforts undertaken by CEFIA. To maximize efficiency, the Companies should be responsible for the day-to-day administration of the contract, with regular oversight and direction on major milestones from the Marketing Committee Education The EDCs must develop tools to measure, for example, increased understanding of energy efficiency, peak demand, the benefits of lowering peak demand, time-of-day rates, renewable energy options, blower door testing, etc., pre and post SLC visit Education The EDCs must develop components of this program to encourage students and educators to reduce their energy consumption and bills, and track actual progress towards that goal. 243

250 B. Utility Capability Documents 1. Northeast Utilities (reproduction of brochure) 244

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